Why is elasticity unitless?
1 Answer
Oct 31, 2015
As we take into account the percentage change in price and quantity, it goes unitless.
Explanation:
You are comparing change in price with change in quantity. They are in different units. You cannot manipulate them mathematically. Hence we take percentage change. The percentage change in quantity id divided by percentage in price. Naturally we cannot assign any units either in terms of price or in terms of quantity.
