You estimate that the price elasticity of demand for clinic visits is -0.25. You anticipate that a major insurer will increase the copay from $10 to $20. This insurer covers 80,000 visits per year. What is your forecast of the change in the number of visits?

Select one:

a.

Visits will drop by 40,000.

b.

Visits will drop by 20,000.

c.

Visits will drop by 16,000.

d.

Visits will drop by 12,000.