Let's say we know that our customers can't make sense of a raise in 5% of the price. It's too little for them to notice. However, an increase above 10% is easily noticed. If this is true, different level of prices impacts the customers in different ways and the formula we learned at college is not enough for real-world problems. Additionally, 10% of increase in something that costs 10 dollars is different than 10% of increase in something that costs 100 dollars, right?
So, how can we deal with this type of problem? How can we deal with price in real-world? How can we get elasticity in this situation?