I love anything that smells goods- this makes me a big consumer of scented candles and products. I have noticed recently that my favorite retailer for scented candles has increased their candle prices by $2.50- making their new small jar candles go up in price from $5.00 to $7.50 this year. Last year I bought 10 candles a month from this retailer, setting aside a monthly $50.00 budget for candles but now with this new price increase I will only be purchasing 7 candles monthly. Therefore, In 2012 I purchased 120 candles yearly and in 2013, I will purchase only 84 yearly.
Therefore:
Point A= Price $5.00 Quantity: 120 Candles
Point B= Price $7.00 Quantity: 84 Candles
The price increased by 40% (7-5=2= 2/5=0.40)
The quantity decreases by 30% (120-84=36=36/120=0.30)

Midpoint Method
Midpoint Price= $6.00 (5.00+7.00/2)
Midpoint Quantity= 102 Candles (120+84/2)
Calculating the price of elasticity demand: ((84-120) / [(84+120)]/2 ) / ((7-5)/ [(7+5)]/2)
=
(-36/102) / (2/6)
=
-0.35/0.33
= 1.06

The price elasticity of demand is 1.06, therefore the change in price is elastic because it is greater than 1 this means that if this elasticity was graphed the price and total revenue would be moving in opposite directions. For this particular product, in my personal case, candles are a luxury therefore, as is calculated usually elastic. Also, because this product in specific, candles have many close substitutes from other retailers and also can be substituted for incense, as