In economics, elasticity is the measurement of how responsive an economic variable is to a change in another. It gives answers to questions such as:

• "If I lower the price of a product, how much more will sell?"
• "If I raise the price of one good, how will that affect sales of this other good?"
• "If the market price of a product goes down, how much will that affect the amount that firms will be willing to supply to the market?"