To determine the price elasticity of demand using the midpoint method over the price range from $10 to $15, we will follow these steps:

1. Identify the quantities demanded at each price level:

   • At a price of $15, the quantity demanded is 10 million cups.
   • At a price of $10, the quantity demanded is 15 million cups.

2. Calculate the percentage change in quantity demanded:

   • $\Delta Q = Q_2 - Q_1 = 15 - 10 = 5$ million cups.
   • The midpoint quantity is $\frac{Q_1 + Q_2}{2} = \frac{10 + 15}{2} = 12.5$ million cups.
   • The percentage change in quantity demanded is $\frac{\Delta Q}{\text{Midpoint quantity}} \times 100 = \frac{5}{12.5} \times 100 = 40\%$.

3. Calculate the percentage change in price:

   • $\Delta P = P_2 - P_1 = 10 - 15 = -5$ dollars.
   • The midpoint price is $\frac{P_1 + P_2}{2} = \frac{15 + 10}{2} = 12.5$ dollars.
   • The percentage change in price is $\frac{\Delta P}{\text{Midpoint price}} \times 100 = \frac{-5}{12.5} \times 100 = -40\%$.

4. Calculate the price elasticity of demand:

   • Using the midpoint method formula for elasticity: $\text{Elasticity} = \frac{\text{Percentage change in quantity demanded}}{\text{Percentage change in price}} = \frac{40\%}{-40\%} = -1$

Since the absolute value of the elasticity is 1, this indicates that the demand is unit elastic over the price range from $10 to $15.

Answer:

The correct answer is:

• d. unit elastic

Would you like further details on this calculation, or do you have any questions?

Here are five related questions to deepen your understanding:

1. How would elasticity change if the price range considered was between $5 and $10 instead?
2. What does it mean for demand to be inelastic or elastic, in terms of consumer response to price changes?
3. How does the midpoint method differ from other methods of calculating elasticity?
4. How would the elasticity calculation change if the demand curve was non-linear?
5. Why is the elasticity calculated as -1 here, and what does the negative sign signify?

Tip: When using the midpoint method, always double-check the percentage changes, as rounding errors can lead to incorrect elasticity calculations.