Suppose the Price of a Bag of Jellybeans Rises from $1.60

question 160

Multiple Choice

Suppose the price of a bag of jellybeans rises from $1.60 to $2.00, causing sales of jellybeans to fall from 120 bags to 80 bags per day. Using the midpoint method, what is the elasticity of demand for jellybeans?

• A) 0.55
• B) 0.75
• C) 1.33
• D) 1.80

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