supply is one in which the elasticity is greater than one, indicating a high responsiveness to changes in price.

Elasticities that are less than one indicate low responsiveness to price changes and correspond to inelastic

demand or inelastic supply. Unitary elasticities indicate proportional responsiveness of either demand or

supply, as Table 5.1 summarizes.

If . . .

Then . . .

And It Is Called . . .

Elastic

Unitary

Inelastic

TABLE 5.1 Elastic, Inelastic, and Unitary: Three Cases of Elasticity

LINK IT UP

Before we delve into the details of elasticity, enjoy this article (http://openstax.org/l/Super_Bowl) on elasticity

and ticket prices at the Super Bowl.

To calculate elasticity along a demand or supply curve economists use the average percent change in both

quantity and price. This is called the Midpoint Method for Elasticity, and is represented in the following

equations:
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