Price elasticity of demand is a measure of the relationship between a change in the quantity demanded of a particular good and a change in its price. To calculate the price elasticity of demand, here’s what you do: Plug in the values for each symbol. Thus, if the price of a commodity falls from Re.1.00 to 90p and this leads to an increase in quantity demanded from 200 to 240, price elasticity of demand would be calculated as follows: In the below given excel template, we have used the price elasticity of demand formula to find the Monthly Price Elasticity of Demand. The table gives a snapshot of the monthly variation in price and consumption of a family of four for the period of January 2014 to October 2014 and calculates the monthly price elasticity of demand. Because $1.50 and 2,000 are the initial price and quantity, put $1.50 into P 0 and 2,000 into Q 0.And because $1.00 and 4,000 are the new price and quantity, put $1.00 into P 1 and 4,000 into Q 1.. Work out the expression on the top of the formula. This formula tells us that the elasticity of demand is calculated by dividing the % change in quantity by the % change in price which brought it about.