Economists estimated that the cross-price elasticity of demand for beer and wine is -0.83 and the income elasticity of wine is 5.03. This means that

A) beer and wine are substitutes and wine is a luxury good.
B) beer and wine are substitutes and wine is an inferior good.
C) beer and wine are complements and wine is a luxury good.
D) beer and wine are complements and wine is an inferior good.


C

Economics

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At equilibrium in a market for a product, the total revenues received by sellers equal the

A. market producer surplus. B. total amount spent by buyers on the product. C. market consumer surplus. D. total profit of sellers.

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In the above figure, an increase in aggregate demand has resulted in

A) a decline in the price level. B) economic growth. C) an inflationary gap. D) a recessionary gap.

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Managers of profit centers are usually given a lot of discretion because

a. They always do an excellent job b. They rarely do a good job c. The company can never judge their performance d. It is relatively easy to tie management pay to division performance

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For market efficiency, MSC must be equated to MSB.

A. True B. False C. Uncertain

Economics