If cross-elasticity of one commodity for another turns out to be zero, it means they are Close substitutes None of these Good complements Completely unrelated

Q: If the price elasticity of demand for a product is equal to 1.5, then a decrease in price of 4…

A: Given: Elasticity = 1.5 Decrease in price = 4%

Q: Identify estimates of the income elasticity of demand for at least two different products (one for…

A: Income elasticity of demand is the change in quantity demanded due to change in income.  Ed= %…

Q: Price elasticity of demand formula: ED= Q2 - Q1/(Q2 + Q1)/2 divided by P2 - P1/(P2 + P1)/2…

A: Price elasticity of demand is a measure of the change in the quantity purchased of a product in…

Q: Distinguish between income elasticity of demand and cross price elasticity of demand. Include in…

A: Elasticity shows how responsive is the quantity demanded to the change in determinants. When…

Q: If the cross price elasticity of demand between two goods is -1.2, then the two goods are:

A: Cross price elasticity of demand refers to the relationship between the quantity demanded of one…

Q: If the cross-price elasticity of demand for Widgets and Twingers is negative, this means the two…

A: An inferior good is the one whose demand decreases with the increase in income and with the fall in…

Q: he cross-price elasticity between a pair of complementary goods will be A) positive or zero…

A: Cross price elasticity of demand measures the responsiveness of quantity demanded of good 1 with…

Q: Suppose that the demand for a good was given by: Qp = 10 -2P. If the price of the good is $2.50 then…

A: Here, demand function is given as: QD=10-2P And price is given as $2.50 To find: Price elasticity…

Q: Cross elasticity of demand is: C Negative for complementary goods C Negative for substitute goods C…

A: The cross-price elasticity of demand measures the responsiveness of demand for a good or service…

Q: If the income elasticity is greater than one, the commodity is

A: To find:  If the income elasticity is greater than one, the commodity is

Q: Why is the cross-price elasticity of demand positive for substitutes? [

A: By the concept of the cross-price elasticity, the responsiveness in the quantity demanded of one…

Q: Suppose that the price of good Y decreased from $18/unit to $16/unit and as a result, the quantity…

A: Cross elasticity of demand measures the responsiveness of changes in the demand for one good caused…

Q: If the cross elasticity of demand for two goods, A and B, is -5,0, then this implies that these…

A: Cross price elasticity of demand measures the responsiveness in quantity demanded of a good to a…

Q: Cross price elasticity of demand between two products may equals zero, a case that is observed when…

A: Given statement: "Cross price elasticity of demand between two products may equals zero, a case that…

Q: The cross elasticity of demand for tennis shoes and tennis socks is negative. True False

A: Cross price elasticity is the percentage change in quantity demanded of good 1 due to percentage…

Q: Given the demand function for commodity x as qx=1500-0.25px2 solve the elasticity of demand for x…

A: qx=1500-0.25px2 Slope of px dqx/dx= -0.5px=0.5(20)=-10

Q: If the cross-price elasticity of demand between blueberries and yogurt is negative, then the two…

A: Cross price elasticity of demand measure the change in quantity demanded of product or service in…

Q: X becomes more expensive to produce, increasing its price. As a result, the demand for good Y…

A: Cross elasticity of demand measures the responsive of percentage change in demand due to some…

Q: The elasticity of demand for luxuries tends to be Select one: a. equal to 0. b. less than 1. c.…

A: Answer: Correct answer: c (greater than 1) Explanation: When the price of luxurious demands…

Q: Suppose we estimate the cross-price elasticity of two goods for a small town to be -.75. In this…

A: The cross-price elasticity of demand is defined as the relationship between two products when the…

Q: If demand for a good is highly elastic, that good is likely to have: a. many close complements. b.…

A: A good tends to have a highly elastic demand if it has many close substitutes.

Q: The income elasticity of beer is estimated to be 0.6; therefore, beer is an inferior good a normal…

A: Income elasticity of demand measures how change in income affects demand for a product.

Q: The cross elasticity of demand between Coca-Cola and Pepsi-Cola is positive, that is, Coke and Pepsi…

A: Substitute goods have positive cross-price elasticity’s of demand If good A is a substitute for good…

Q: For each scenario, calculate the cross-price elasticity between the two goods and identify how the…

A: Cross price elasticity of demand: It refers to the degree of responsiveness of demand for one good…

Q: Comment on the Elasticity of demand for a good having high number of substitutes

A: The concept of elasticity of demand for any good is a measure and indicator which shows how the…

Q: If the cross-price elasticity of Nicorette, a nicotine replacement therapy, and cigarettes is 0.7,…

A: An economic term is known as "cross-elasticity of demand" evaluates how quickly demand for one…

Q: If the cross-price elasticity of demand between good A and good B is -1.25, then the goods are A…

A: Cross-price elasticity: - Cross-price elasticity of demand measures the responsiveness of change in…

Q: If the cross-price elasticity between two goods is negative, these goods are a. Inferior. b.…

A: Separate usage of the complimentary good has almost zero benefit, however if associated with some…

Q: For each scenario, calculate the cross-price elasticity between the two goods and identify how the…

A: Cross price elasticity of demand measures the responsiveness of quantity demanded of good 1 with…

Q: Positive income elasticity implies that as income rises, demand for the commodity A. Rises B. Falls…

A: So accordingly the positive income elasticity are the normal goods as relatively with the rise in…

Q: Define cross demand and Describe with examples that cross demand is positive for substitutes but…

A: Before answering this question, let us first understand some key concepts relating to demand and…

Q: Suppose that a 7 percent increase in the price of normal good Y causes a 4 percent increase in the…

A: Cross elasticity of demand formula: If there is change in price of good y then quantity demanded of…

Q: when the income elasticity of demand is greater than unity, the commodity is  a. A non-related…

A: Income elasticity of demand shows how much the quantity demanded of a good changes when the income…

Q: Explain why the cross elasticity of demand for substitute goods is positive and the cross elasticity…

A: Demand: The term demand refers to the quantity of a commodity for which the consumer is willing to…

Q: If cross-price elasticity of demand between two goods is positive, the two goods are:

A: The price elasticity of demand is the responsiveness of the quantity demanded to the change in…

Q: If the cross elasticity of demand for two goods, A and B, is +5,0, then this implies that these…

A: The concept of cross elasticity of demand is used to explain percentage change in quantity demanded…

Q: Determine the price elasticity of demand between each of the following prices

A: The price elasticity of demand is the responsiveness of quantity when nothing but the price changes.…

Q: Zulaikha wanted to buy 10 kg of rice and Ker Xin wanted to buy RM20 worth of rice. Find the price…

A: Price elasticity of demand can be calculated as follows: Price elasticity of demand=% change in…

Q: Assuming that the demand for good x is: x(p) = 1/2 m/p. a. Derive the price elasticity of demand…

A: The price-elasticity(e) of demand is calculated as e=-∂x(p)∂p×px x(p): Quantity demanded p:price

Q: If the demand equation is P = 30 10 Which of the following represents a general expression for the…

A: Price elasticity of demand is a measure of change in the quantity demanded of a commodity with…

Q: If the cross elasticity of demand between bread rolls and cheese is –3,0, this implies that these…

A: Cross price elasticity is the responsiveness of quantity demanded of one good when price of another…

Q: If the cross elasticity of demand for two goods, A and B, is +5,0, then this implies that these…

A: The concept of cross elasticity of demand is used to explain percentage change in quantity demanded…