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Cross-Price Midpoint Elasticity

Measure how quantity of product B changes when product A’s price changes.

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Calculator inputs

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How to use this calculator

  1. Enter the known values in the units shown. Results update as you type.
  2. Where results are editable, change one to solve backwards. Lock a value to hold it fixed.
  3. Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

Doubling both product A’s price and product B’s quantity gives midpoint cross-price elasticity of +1.

Elasticity = ((Q2 − Q1)/(Q2 + Q1)) / ((P2 − P1)/(P2 + P1)).

Worked example

Enter these known values and leave the other values blank.

Price of product A
10 USD
Price of product A
20 USD
Demand for product B
100
Demand for product B
200
Elasticity
1

Assumptions and limitations

  • Both prices and quantities must be positive, and the two prices must differ. This uses the midpoint convention.
  • A positive sign is consistent with substitutes and a negative sign with complements; two observations alone do not establish causation.
  • Enter all money amounts in one currency. The retained currency conversion menu uses captured historical conversion factors, not current exchange quotes.
  • Clear an unknown editable field before solving an inverse; fixed selections and output-only fields cannot be inferred.

Common questions

What does this calculation assume?

Both prices and quantities must be positive, and the two prices must differ. This uses the midpoint convention.

Are these current exchange rates?

No. Use one currency consistently; currency menu factors are a historical snapshot.

References

Normalize captured comparison syntax without changing its mathematical truth conditions. Require a nonzero midpoint price difference.

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