Cross-price elasticity is used to determine whether goods are: Group of answer choices A. inferior or normal goods B. necessities or luxuries C. none of the answers are correct. D. complements or substitutes

Cross-price elasticity is used to determine whether goods are: Group of answer choices A. inferior or normal goods B. necessities or luxuries C. none of the answers are correct. D. complements or substitutes

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter20: Elasticity: Demand And Supply

Section: Chapter Questions

Problem 5E

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Question

20. Cross-price elasticity is used to determine whether goods are:

Group of answer choices

A. inferior or normal goods

B. necessities or luxuries

C. none of the answers are correct.

D. complements or substitutes

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Identify the type of goods which have zero cross elasticity of demand. a. Normal goods b. Independent goods c. Dependent goods d. Substitute goods
Activity 1. Answer the following questions: a. Illustrate and explain how consumer equilibrium is achieved using the indifference curve? b. How do we measure utility? Explain. c. Discuss how the demand elasticity of a product changes? Give examples.
You are told that the cross-price elasticity between goods X and Y is 2.0. This means that a. Goods X and Y are normal goods. b. Goods X and Y are inferior goods. c. Goods X and Y are complementary goods. d.Goods X and Yare substitute goods.
I. Multiple choice. Encircle the correct answer. 1. If the income elasticity of a demand for a good is negative, then the good is a. normal good b. inferior good c. luxury good d. necessity 2. If the cross elasticity of demand between two goods is negative, then the two goods are: a. normal good b. inferior good c. luxury good d. necessity 3. Tennis racquets and tennis balls are likely to have a positive cross elasticity of demand. a. true b. false 4. Price elasticity of demand a. responsiveness of demand to changes in the price of some other product. b. responsiveness of demand for a product to changes in its own price. c. increase in real income may cause demand to fall. d. responsiveness of demand for a product to changes in consumer income. 5. Cross-elasticity of demand a. responsiveness of demand to changes in the price of some other product. b. responsiveness of demand for a product to changes in its own price. c. increase in real income may cause demand to fall. d.…
question 18
When consumers' incomes increased 10 percent, the quantity of milk bought increased 5 percent. This result means A. milk is a luxury. B. milk is a necessity. C. the demand for milk is income elastic. D. milk is an inferior good.
If a good is an inferior good, then its A. Engel curve cannot be drawn. B. demand curve will be upward sloping. C. income effect reinforces the substitution effect. D. income elasticity is negative
An income elasticity of 2 for watermelon juice indicates that: (a) Watermelon juice is inferior goods. (b) Watermelon juice is normal goods. (c) Watermelon juice is a close substitute of mango juice. (d) Watermelon juice and Haleem are complements. Justify:
If the cross-price elasticity of demand for good A when the price of B changes is negative that indicates: a. That goods A and B are supplementary goods. b. That goods A and B are complementary goods. c. That goods A and B are necessity goods. d. That goods A and B are inferior goods.
u are told that the cross-price elasticity between goods X and Y is2.0. This means that a. Goods X and Y are normal goods. b. Goods X and Y are inferior goods. c. Goods X and Y are complementary goods. Goods X and Yare substitute goods.
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What is the cross price elasticity?