4.6 #3

In the following questions use the fact that the elasticity of coffee is Edit E = 1.4. (a) If the price of coffee drops from $13.00 to $12.50, does the demand for coffee increase or decrease? The demand for coffee increases. (b) Estimate the percent change in the quantity demanded if the price of coffee drops from $13.00 to $12.50. NOTE: Round your answer to at least one decimal place. The percent change in the quantity demanded is approximately equal to 0.054 %. X www.ers.usda.gov/data-products/commodity-and-food-clasticities, accessed June 2017