By the percentage method, eₚ =

percentage change in price ÷ percentage change in quantity demandedCorrect answerYour answerchange in quantity ÷ change in priceCorrect answerYour answerprice × quantityCorrect answerYour answerpercentage change in quantity demanded ÷ percentage change in priceCorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer D

Correct answer: D

eₚ = (ΔQ ÷ Q × 100) ÷ (ΔP ÷ P × 100), which simplifies to (ΔQ ÷ ΔP) × (P ÷ Q).
It is usually read without its minus sign, since price and quantity move in opposite directions.

Worth noting

Change in quantity ÷ change in price is the slope term alone; elasticity also needs P ÷ Q.

Concept: Formula of the percentage method
Typical timeTypical: 40 s
Your timeYours: —

The rule this testsThe percentage method

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By the percentage method, eₚ =

Explanation