Price elasticity of demand is the measure of the degree of responsiveness of the demand for a good to the change in its price. The price elasticity of demand can be defined as the change in the demand of a particular commodity due to the change in its price.

According to Lipsey - "Price elasticity of demand is defined as the percentage of change in quantity demanded divided by the percentage change in price."

Where

E_d – Elasticity of demand

Proportionate change in quantity demanded = (q₁-q₀)/q₀

Proportionate change in price = (p₁-p₀)/p₀