Elasticity

In general, the percentage change in one variable given – CETERIS PARIBUS – a one percent increase in another variable. – Price elasticity is the change in quantity divided by the change in price (the percentage change in the quantity divided by the percentage change in the price). – For an option, the percentage change in the value given a one percent change in the price of the underlying (the percentage increase in an option’s value given a one percent change in the value of the underlying).

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
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