What does it mean if PED is between 0 and -1?

If PED is between 0 and -1, demand is relatively inelastic.

What does it mean if PED is infinity?

If PED is infinity, demand is perfectly elastic.

What is the relevance of PED in terms of a firm's total revenue?

Firms that sell a good or service that is price inelastic in demand can raise prices and their total revenue will increase. Firms that sell a good or service that is price elastic in demand can raise prices but their total revenue will decrease.

Y12 Microeconomics Notes

PED | A-Level Economics Notes

Jaisul Naik

12 Feb 2026 • 1 min read

These revision notes cover everything you need to know about PED for A-Level Economics. They're designed for students studying AQA A-Level Economics, Edexcel A-Level Economics, and Edexcel International A-Level Economics. Written by Jaisul Naik, UCL Economics graduate and A-Level Economics tutor since 2017.

What is the formula for PED?

% change in demand/ % change in price

What is the definition of PED?

PED is the responsiveness of demand to a change in price.

What does it mean if PED = 0?

If PED = 0, demand is perfectly inelastic.

This means that, even if the price changes, demand does not change at all.

What does it mean if PED is between 0 to -1?

If PED is between 0 to -1, demand is relatively inelastic.

What does it mean if PED is -1?

If PED is -1, demand is unit elastic.

What does it mean if PED is less than -1?

If PED is less than -1, demand is relatively elastic.

What does it mean if PED is -ထ?

If PED is ထ, PED is perfectly elastic.

What are the factors that affect PED?

SANDPIT

availability of substitutes
addictiveness
necessity
durability
the price of the good as a proportion of your income
time