Section 1
Price Elasticity of Demand
Book
Version 3
By Boundless
By Boundless
Boundless Economics
Economics
by Boundless
4 concepts
![Thumbnail](../../../../../../figures.boundless-cdn.com/19978/square/elasticity-elastic.jpg)
Defining Price Elasticity of Demand
The price elasticity of demand (PED) measures the change in demand for a good in response to a change in price.
![Thumbnail](../../../../../../figures.boundless-cdn.com/20555/square/-of-demand-and-revenue.jpg.jpg)
Measuring the Price Elasticity of Demand
The price elasticity of demand (PED) is calculated by dividing the percentage change in quantity demanded by the percentage change in price.
![Thumbnail](../../../../../../figures.boundless-cdn.com/20086/square/icity-and-the-demand-curve.jpeg)
Interpretations of Price Elasticity of Demand
The price elasticity of demand (PED) explains how much changes in price affect changes in quantity demanded.
Determinants of Price Elasticity of Demand
A good's price elasticity of demand is largely determined by the availability of substitute goods.