{"id":10822,"date":"2021-11-06T19:10:20","date_gmt":"2021-11-06T13:40:20","guid":{"rendered":"https:\/\/scholarsclasses.com\/blog\/?p=10822"},"modified":"2025-10-09T16:41:40","modified_gmt":"2025-10-09T11:11:40","slug":"what-is-elasticity-of-demand","status":"publish","type":"post","link":"https:\/\/scholarsclasses.com\/blog\/what-is-elasticity-of-demand\/","title":{"rendered":"What is Elasticity of Demand |  Free Economic Blogs"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_81 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69d7d4cdc8261\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69d7d4cdc8261\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/scholarsclasses.com\/blog\/what-is-elasticity-of-demand\/#What_is_Elasticity_of_Demand\" >What is Elasticity of Demand?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/scholarsclasses.com\/blog\/what-is-elasticity-of-demand\/#Concept_of_Elasticity_of_Demand\" >Concept of Elasticity of Demand<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/scholarsclasses.com\/blog\/what-is-elasticity-of-demand\/#Types_of_Elasticity_of_Demand\" >Types of Elasticity of Demand<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/scholarsclasses.com\/blog\/what-is-elasticity-of-demand\/#1_Income_elasticity\" >1) Income elasticity<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/scholarsclasses.com\/blog\/what-is-elasticity-of-demand\/#2_Cross_elasticity\" >2) Cross elasticity<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/scholarsclasses.com\/blog\/what-is-elasticity-of-demand\/#3_Price_elasticity\" >3) Price elasticity<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading has-text-align-center has-black-color has-text-color\"><span class=\"ez-toc-section\" id=\"What_is_Elasticity_of_Demand\"><\/span>What is Elasticity of Demand?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img decoding=\"async\" width=\"1024\" height=\"576\" data-src=\"https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/11\/What-is-Elasticity-of-Demand-1024x576.jpg\" alt=\"What is Elasticity of Demand?\" class=\"wp-image-10840 lazyload\" title=\"\" data-srcset=\"https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/11\/What-is-Elasticity-of-Demand-1024x576.jpg 1024w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/11\/What-is-Elasticity-of-Demand-300x169.jpg 300w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/11\/What-is-Elasticity-of-Demand-768x432.jpg 768w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/11\/What-is-Elasticity-of-Demand-1536x864.jpg 1536w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/11\/What-is-Elasticity-of-Demand-640x360.jpg 640w, https:\/\/scholarsclasses.com\/blog\/wp-content\/uploads\/2021\/11\/What-is-Elasticity-of-Demand.jpg 1920w\" data-sizes=\"(max-width: 1024px) 100vw, 1024px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1024px; --smush-placeholder-aspect-ratio: 1024\/576;\" \/><figcaption class=\"wp-element-caption\">What is Elasticity of Demand?<\/figcaption><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Concept_of_Elasticity_of_Demand\"><\/span>Concept of Elasticity of Demand<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The term elasticity indicates the responsiveness of one variable to a change in the other variable. The elasticity of demand refers to the degree of responsiveness of quantity <a href=\"https:\/\/www.nios.ac.in\/media\/documents\/SecEcoCour\/English\/Chapter-9.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">demanded<\/a> to a change in its price or any other factor.<\/p>\n\n\n\n<p>According to Prof. Marshall, \u201c<strong>Elasticity of demand is great or small according to the amount demanded which rises much or little for a given fall in price and quantity demanded falls much or little for a given rise in price.<\/strong>\u201d<\/p>\n\n\n\n<p>It is clear from the above definition that elasticity of demand is a technical term that describes the responsiveness of change in quantity demanded to fall or rise in its price. In other words, it is the ratio of percentage change in quantity demanded of a commodity to a percentage change in price.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/scholarsclasses.com\/blog\/microeconomic-definition\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/microeconomic-definition\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Microeconomic Definition | Historical Review of Microeconomics<\/strong><\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/scholarsclasses.com\/blog\/scope-of-microeconomics\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/scope-of-microeconomics\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Scope Or Nature of Microeconomics<\/strong><\/a><\/li>\n\n\n\n<li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/features-of-microeconomics\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/features-of-microeconomics\/\" target=\"_blank\" rel=\"noreferrer noopener\">Features of Microeconomics<\/a><\/strong><\/li>\n\n\n\n<li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/importance-of-microeconomics\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/importance-of-microeconomics\/\" target=\"_blank\" rel=\"noreferrer noopener\">Importance of Microeconomics<\/a><\/strong><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Types_of_Elasticity_of_Demand\"><\/span>Types of Elasticity of Demand<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"1_Income_elasticity\"><\/span>1) Income elasticity<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>It refers to the degree of responsiveness of a change in quantity demanded to a change in income only, other factors including price remain unchanged. <br>It is expressed as :<\/p>\n\n\n\n<p><strong>Ey = Percentage change in Qty. Demanded \/ Percentage change in Income<\/strong><\/p>\n\n\n\n<p><strong>Symbolically,<\/strong><br>Ey =%\u25b2Q \/ % \u25b2Y<br>Where,<br>\u25b2 = Represents change<br>Q = Orignal demand<br>Y = Orignal income<br>\u25b2Q = Change in quantity demanded<br>\u25b2Y = Change in the income of a consumer<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"2_Cross_elasticity\"><\/span>2) Cross elasticity<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>It refers to a change in the quantity demanded of one commodity due to a change in the price of other commodities. (Complementary goods or substitutes)<\/p>\n\n\n\n<p><strong>Ec = Percentage change in Qty. demanded of A \/ Percentage change in Price of B<\/strong><\/p>\n\n\n\n<p>(A = Original commodity, B = Other commodity)<\/p>\n\n\n\n<p><strong>Symbolically,<\/strong><br>Ec =%\u25b2Q<sub>A<\/sub> \/ % \u25b2P<sub>B<\/sub><br>Where,<br>Q<sub>A<\/sub> = Original quantity demanded of commodity A<br>\u25b2Q<sub>A<\/sub> = Change in quantity demanded of commodity A<br>P<sub>B<\/sub> = Original price of commodity B<br>\u25b2P<sub>B<\/sub> = Change in price of commodity B<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"3_Price_elasticity\"><\/span>3) Price elasticity<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>According to Prof. Alfred Marshall, price elasticity of demand is a ratio of proportionate change in the quantity demanded of a commodity to a given proportionate change in its price.<\/p>\n\n\n\n<p><strong>Ed = Percentage change in Quantity Demanded \/ Percentage change in Price<\/strong><\/p>\n\n\n\n<p><strong>Symbolically,<\/strong><br>E<sub>d<\/sub> =%\u25b2Q \/ % \u25b2P<br>Where,<br>Q = Original quantity demanded<br>\u25b2Q = Change in quantity demanded<br>P = Original price <br>\u25b2P = Change in price <\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/importance-of-law-of-diminishing-marginal-utility\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/importance-of-law-of-diminishing-marginal-utility\/\" target=\"_blank\" rel=\"noreferrer noopener\">Importance of Law of Diminishing Marginal Utility<\/a><\/strong><\/li>\n\n\n\n<li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/utility-in-economics-meaning-concepts\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/utility-in-economics-meaning-concepts\/\" target=\"_blank\" rel=\"noreferrer noopener\">Utility in Economics ( Concepts of Utility )<\/a><\/strong><\/li>\n\n\n\n<li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/features-of-utility\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/features-of-utility\/\" target=\"_blank\" rel=\"noreferrer noopener\">Features of Utility<\/a><\/strong><\/li>\n\n\n\n<li><strong><a href=\"https:\/\/scholarsclasses.com\/blog\/types-of-utility\/\" data-type=\"URL\" data-id=\"https:\/\/scholarsclasses.com\/blog\/types-of-utility\/\" target=\"_blank\" rel=\"noreferrer noopener\">Types of Utility<\/a><\/strong><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>&#46;&#46;&#46;<\/p>\n","protected":false},"author":1,"featured_media":10840,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[10,1],"tags":[3660],"class_list":["post-10822","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-educational-blogs","category-misc","tag-what-is-elasticity-of-demand"],"_links":{"self":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/10822","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/comments?post=10822"}],"version-history":[{"count":4,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/10822\/revisions"}],"predecessor-version":[{"id":35698,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/posts\/10822\/revisions\/35698"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/media\/10840"}],"wp:attachment":[{"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/media?parent=10822"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/categories?post=10822"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/scholarsclasses.com\/blog\/wp-json\/wp\/v2\/tags?post=10822"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}