The pair of items that is likely to have the LARGEST positive cross-price elasticity of demand is:
A) coffee and tea.
B) skis and ski boots.
C) pizza and pepperoni.
D) milk and cookies.
Answer: A) coffee and tea.
Economics
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The consumer maximizes his total utility (measured in money terms) when, at his chosen quantity of every good he buys, marginal utility
a. equals zero. b. divided by price equals zero. c. equals price. d. equals total utility.
Economics
The total revenue test for elasticity:
A. is equally applicable to both demand and supply. B. does not apply to demand because price and quantity are inversely related. C. does not apply to supply because price and total revenue always move together. D. applies to the short-run supply curve but not to the long-run supply curve.
Economics