# Calculating price elasticity by asking a “this” or “that” question

Let's say 2 goods exist: A for 10 and B for 20 (B is more premium in this example)

If I decrease the price of both goods by 10% and ask:

"Do you prefer A for 9 or B for 18 "

What sort of insights (elasticities, etc.) would I be able to get from this? I figure the usual arc elasticity is not possible for this, since the units are discrete.

Is it also possible to get other insights if I lower the price of the premium product more than the cheap product? i.e.:

"Do you prefer A for 9 or B for 17?"

Or even lower the price of the cheap product more than the premium, i.e,

"Do you prefer A for 8 or B for 18?"

I'm thinking about any insights that I can get from asking these sorts of questions, but the traditional equations of elasticity don't seem to apply.

The elasticity of demand measures how changes in prices affect changes in quantities demanded So if you have the total quantity demanded at the original prices and reduced them by, say, $$10\%$$, then observe the total quantity demanded of both goods, you can calculate elasticity by simply using the arc formula, or the midpoint formula, etc. In fact, by just varying one good at a time, or reducing one good more than the other, you could also estimate cross-price elasticities.