Price elasticity of demand refers to how much the sales of a product change when the price of that product changes. If the price of the product goes up and there is a great decrease in the sales of the product, we say that the demand for the product is elastic. If the price increases and there is not a great decrease in the sales of the product, we say that the demand for the product is relatively inelastic.
Here is an actual formula for finding elasticity more formally:
PEoD = (% Change in Quantity Demanded)/(% Change in Price)
If the price elasticity of demand is greater than 1 and less than infinity, we say that demand for that good is relatively elastic.