Final answer:
The correct answer is option (a), a 22.22% decrease in price. This is calculated using the midpoint formula, which involves finding the difference between the two prices, dividing by their midpoint or average, and then multiplying by 100 to get the percentage.
Step-by-step explanation:
To calculate the percentage decrease in price using the midpoint formula from $50 to $40, we need to divide the difference in price by the average of the two prices and then multiply by 100 to convert it into a percentage.
First, we find the difference in price: $50 - $40 = $10. Next, we find the midpoint (average) of the two prices: ($50 + $40) / 2 = $45. Now, we divide the difference by the midpoint: $10 / $45 ≈ 0.2222. Finally, we multiply by 100 to get the percentage decrease: 0.2222 x 100 ≈ 22.22%.
Therefore, the decrease in price represents a 22.22% decrease in price, which corresponds to option (a).