For Students · Price Elasticity
Price Elasticity for a subsidy
Built for students learning it for a class or exam. See the concept move instead of memorizing formulas — and check your homework intuition. Simulate a subsidy live below — adjust the inputs and watch it respond, right in your browser.
Price Elasticity of DemandLive
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Elasticity measures how much quantity demanded responds to price. Where demand is elastic (|E| > 1), a price cut raises total revenue; where it is inelastic, a price cut lowers revenue. On a straight-line demand curve the top half is elastic, the bottom half inelastic, and revenue peaks exactly at the midpoint where elasticity equals one.
Data Inspector
Quantity50.0
Elasticity-1.00
Typeunit
Revenue$2500
Governing equation
Reading this result: You are at the unit-elastic midpoint: revenue is at its maximum, and small price moves in either direction leave it roughly unchanged.
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- Is this good for students?
- Yes — this version of "Price Elasticity for a subsidy" is framed for students learning it for a class or exam. See the concept move instead of memorizing formulas — and check your homework intuition.
- Do I need to install anything?
- No. It runs in any modern browser, free, with no account required.