Danny "Dimes" Donahue is a neighborhood's 9-year-old entrepreneur. His most recent venture is selling homemade brownies that he bakes himself. At a price of $2.75 each, he sells 250. At a price of $2.25 each, he sells 300.

Instructions:Use the midpoint method and round your answer to 2 decimal places. Do not include a minus sign.

a. What is the elasticity of demand?

b. Is demand elastic or inelastic over this price range?

• Elastic

• Inelastic

c. If demand had the same elasticity for a price decline from $2.25 to $1.75 as it does for the decline from $2.75 to $2.25, would cutting the price from $2.25 to $1.75 increase or decrease Danny's total revenue?

• Increase

• Decrease

Please explain your answer