When the Price of a Cup of Coffee Falls from $3.00

Multiple Choice

When the price of a cup of coffee falls from $3.00 to $2.50, the quantity demanded increases from 1,000 per month to 1,150 per month. Using the midpoint method, the price elasticity of demand is

A) 0.77.
B) 1.30.
C) 0.07.
D) 2.50.
E) 3.00.