Introduction to Economics 1 Deneme Sınavı Sorusu #1278523

Which of the following is true?


Cross-price elasticity of demand is positive for complement goods

Cross-price elasticity of demand is greater than zero for complement goods

Cross-price elasticity of demand is smaller than zero for substitute goods

Cross-price elasticity of demand is negative for substitute goods

Cross-price elasticity of demand is positive for substitute goods


Yanıt Açıklaması:

For Substitute goods, the cross-price elasticity of demand is positive since the price increase of good X causes the quantity demanded of good Y to increase.
For substitutes, Cross-price elasticity of demand is greater than zero.

For complement goods, the cross-price elasticity of demand is negative because a price increase in good X causes the quantity demanded of good Y to decrease.

For complements,Cross-price elasticity of demand is less than zero.

Answer is E.

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