The change in output from hiring one additional unit of labor:

Which is an example of market size affecting demand?

a. Restaurant visits drop after a hurricane causes a city to be evacuated. b. A computer chip maker moves to a town and hires hundreds. c. After a team wins the World Series, it becomes a fad to buy their caps. d. Sales of potato chips drop after the price of pretzels falls by half.

The above figure shows the demand curve for movie rentals from Redbox. If Redbox raised its price from $2.50 to $3.00, between these two prices the price elasticity of demand equals

A) 1.2. B) 0.8. C) 2.0. D) 0.5.