Identify the price and quantity demanded at two different points
Use the formula: Elasticity of Demand = (% change in quantity demanded) / (% change in price)
Calculate the percentage change in quantity demanded
Calculate the percentage change in price
Divide the percentage change in quantity demanded by the percentage change in price
Use the midpoint formula if needed: [(Q2 – Q1) / ((Q2 + Q1) / 2)] / [(P2 – P1) / ((P2 + P1) / 2)]
Interpret the result as elastic, inelastic, or unitary elastic
For point elasticity, use: Elasticity = (dQ/dP) × (P/Q)