Recall the Application About How Changes in Supply Affect the Price

Multiple Choice

Recall the Application about how changes in supply affect the price of gasoline to answer the following question(s) .
-Recall the Application.Suppose the price elasticity of demand for gasoline is 0.20 and the price elasticity of supply for gasoline is 0.55.If supply increases by 40 percent,the equilibrium price will decrease by

A) 54 percent.
B) 72 percent.
C) 114 percent.
D) 188 percent.