If the cross elasticity of demand is negative, that means the goods
A) have elastic demands.
B) have inelastic demands.
C) are complements.
D) are substitutes.
E) are inferior.
C
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When analyzing graphically the relationship between more than two variables, which of the following must be used?
A) the assumption that only relevant factors change B) positive slope assumption C) assumption of little change D) negative slope assumption E) ceteris paribus
Refer to the payoffs in the table above. Sears and Wal-Mart must decide whether to lower their prices based on the profits shown in the table. This game has
A) no Nash equilibrium. B) a Nash equilibrium: Sears keeps its prices high and Wal-Mart lowers its prices. C) a Nash equilibrium: both Sears and Wal-Mart keep prices high. D) a Nash equilibrium: both Sears and Wal-Mart lower prices.