Refer to Figure 5.3. Use the midpoint formula. If the price of a gardenburger decreases from $8 to $7, the price elasticity of demand equals ________ and demand is ________.

A) -0.47; inelastic
B) -2.14; elastic
C) -2.29; inelastic
D) -3.5; elastic

The price elasticity of demand (PED) is calculated using the midpoint formula: PED = [(Q2 - Q1) / ((Q2 + Q1)/2)] / [(P2 - P1) / ((P2 + P1)/2)]. Without specific quantities (Q1 and Q2), we can't directly calculate it from the information given. However, the correct answer is based on the understanding that a PED greater than 1 in absolute value indicates elastic demand, meaning consumers are relatively responsive to price changes. -2.14 is the only option that indicates elasticity (absolute value greater than 1) and is a plausible value for a PED calculation, suggesting a significant change in quantity demanded for a small change in price.