The larger the positive cross elasticity coefficient of demand between products X and Y, the:
A. stronger their complementariness.
B. greater their substitutability.
C. smaller the price elasticity of demand for both products.
D. the less sensitive purchases of each are to increases in income.
Answer: B
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A good which has social costs that exceed private costs has a price
A) equal to marginal social cost. B) that is too low. C) that is too high. D) that is inefficient because price exceeds marginal social cost.
Personal income taxes rise. This lowers __________, which lowers __________ and the __________ curve shifts __________
A) net exports; aggregate demand (AD); AD; leftward B) consumption; short-run aggregate supply (SRAS); SRAS; rightward C) government revenue; net exports; AD; rightward D) consumption; aggregate demand (AD); AD; leftward E) none of the above