The cross price elasticity of demand between two goods is 2. We may conclude that
A. the two goods are poor substitutes for each other.
B. the demand for each of the goods is likely to be very elastic.
C. the demand for one of the goods is likely to be fairly elastic and the demand for the other good is likely to be fairly inelastic.
D. the two goods are very complementary and probably are sold together.
Answer: B
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Enacting a law controlling rents near a major university will increase the affordable housing for college students.
Answer the following statement true (T) or false (F)
As of 2013, how large is the debt of developing countries to the rest of the world?
A) $350 million B) $350 billion C) $7 trillion D) $35 trillion E) $3.5 trillion
Ch 1.The fallacy of composition is the incorrect view that
What will be an ideal response?
Consider the following two investments. One is a risk-free investment with a $100 return. The other investment pays $2,000 20% of the time and a $375 loss the rest of the time. Based on this information, answer the following: (i) Compute the expected returns and standard deviations on these two investments individually. (ii) Compute the value at risk for each investment. (iii) Which investment will risk-averse investors prefer, if either? Which investment will risk- neutral investors prefer, if either?
What will be an ideal response?