Final answer:
When the price of JT Chip Co. chips decreases from $1.89 to $1.49 and the demand elasticity is 4.0, the number of bags sold will increase significantly.
Step-by-step explanation:
If the elasticity of demand for JT Chip Co. chips is 4.0, a decrease in price from $1.89 to $1.49 would lead to a significant increase in the number of bags sold. This is because the demand is highly elastic, indicating that consumers are very responsive to price changes. A high elasticity value, such as 4.0, suggests that the percentage change in quantity demanded will be greater than the percentage change in price. Therefore, the number of bags sold will increase significantly (Option A)