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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Definitions:

Seafloor Spreading

The process by which new oceanic crust is formed at mid-ocean ridges as tectonic plates diverge, leading to the gradual widening of the ocean.

Transform Faulting

A geological process in which tectonic plates slide horizontally past each other along transform faults, often causing earthquakes.

Red Sea

A seawater inlet of the Indian Ocean, lying between Africa and Asia, known for its unique marine life and geological features.

Subduction

The process along a convergent plate-tectonic boundary in which an oceanic lithospheric plate descends beneath the overriding plate.