The Potomac Range Corporation manufactures a line of microwave ovens costing $$500$ each. Its sales have averaged about $6,000$ units per month

during the past year. In August, Potomac's closest competitor, Spring City Stove Works, cut its price for a closely competitive model from $$600$ to

$$450.$ Potomac noticed that its sales volume declined to $4,500$ units per month after Spring City announced its price cut.

What is the arc cross elasticity of demand between Potomac's oven and the competitive Spring City model?

$0$

$-0\mathrm{.}5$

$1\mathrm{.}0$

$-1\mathrm{.}0$

If Potomac knows that the arc price elasticity of demand for its ovens is $-1\mathrm{.}0,$ what price would Potomac have to charge to sell the same number of

units it did before the Spring City price cut?

$$450$

$$571$

$$667$

$$375$