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What can be said about goods X and Y if the cross price elasticity between X and Y is negative multiple choice question?
If the cross-price elasticity of demand for goods X and Y is negative, this means the two goods are d. complements.
When cross elasticity between x and y is greater than zero or positive x and y are?
The correct option is: a.
A cross-price elasticity greater than zero implies a positive cross-price elasticity. For substitute goods, the cross-price elasticity of demand is always positive.
When cross price elasticity is negative the two goods are?
A negative cross elasticity denotes two products that are complements, while a positive cross elasticity denotes two products are substitutes. If products A and B are complements, an increase in the price of B leads to a decrease in the quantity demanded for A, as A is used in conjunction with B.
What is the significance of a positive cross elasticity coefficient between products X and Y?
A positive cross price elasticity between two goods implies that an increase in price of one good leads to an increase in the demand for the other good. A higher cross price elasticity implies a higher substitutability.