An elasticity of demand calculator is a software that measures the responsiveness of shopper demand to modifications in value. It’s calculated by dividing the proportion change in amount demanded by the proportion change in value. A calculator might be helpful for companies to know how modifications in value will have an effect on demand for his or her services or products.
The elasticity of demand is a vital idea in economics as a result of it will possibly assist companies make knowledgeable choices about pricing. If demand is elastic, then a small change in value will result in a big change in amount demanded. On this case, companies could need to contemplate reducing costs to extend demand. If demand is inelastic, then a small change in value will result in a small change in amount demanded. On this case, companies could need to contemplate elevating costs to extend income.