The cross-price elasticity of demand between good X and good Y is-3. Given this information, which of the following statements is TRUE? O The demand for goods X and Y is elastic. O Goods X and Y are substitutes. O Goods X and Y are complements. O The demand for goods X and Y is income elastic.

The cross-price elasticity of demand between good X and good Y is-3. Given this information, which of the following statements is TRUE? O The demand for goods X and Y is elastic. O Goods X and Y are substitutes. O Goods X and Y are complements. O The demand for goods X and Y is income elastic.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter19: Elasticity

Section: Chapter Questions

Problem 2WNG: As the price of good X rises from 10 to 12, the quantity demanded of good Y rises from 100 units to...

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Concept explainers

Elasticity of Demand and Supply

The elasticity of demand and supply are two important concepts of microeconomics. The elasticity of demand measures the responsiveness of consumers’ demands to the price change, changes in income of consumers, and changes in the price of the related goods. Similarly, the elasticity of supply refers to the proportionate change in the quantity supplied due to the proportionate change in the price. In other words, it can be said that elasticity of supply measures how the quantity of supply changes when the price changes of that particular product.

Question

The cross-price elasticity of demand between good X and good Y is -3. Given this
information, which of the following statements is TRUE?
O The demand for goods X and Y is elastic.
O Goods X and Y are substitutes.
O Goods X and Y are complements.
O The demand for goods X and Y is income elastic.

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