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In economics, elasticity is the ratio of the percent change in one variable to the percent change in another variable. It is a tool for measuring the responsiveness of a function to changes in parameters in a relative way. Commonly analyzed are elasticity of substitution, price and wealth. Elasticity is a popular tool among empiricists because it is independent of units and thus simplifies data analysis. An "elastic" good is one whose price elasticity of demand has a magnitude greater than one. Similarly, "unity elastic" and "inelastic" describe goods with price elasticity having a magnitude of one and less than one respectively. In economics, the definition of elasticity is based on the mathematical notion of point elasticity. Elasticity can be calculated for any function but in empirical work it is commonly used to analyze supply or demand. Let  be the demand (supply) of goods  as a function of parameters price and wealth, and let  be the demand for good  . The general definition, according to Mas-Collel, Winston and Green is Elasticity can be approximated using percent changes
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