What is the main advantage of using the midpoint method for calculating elasticity?

Answer 1

When we compute price elasticity between any two points on a demand curve, we get a different answer depending on which point we choose to start and which point we choose to finish if we take the change in price and quantity as a percent of the starting value for each. With the midpoint method, the percentage changes in quantity and price are calculated by dividing the change in the variable by the average or midpoint value of the two points on the curve, not the starting point on the curve. In other words, it avoids the problem of getting a different answer when we computer price elasticity between any two points on a demand curve and it calculates by dividing the change in the variable by the midpoint value of the two points on the curve instead of the starting point on the curve. That is the advantage of using the midpoint method for calculating elasticity.