Price, Income And Cross Elasticies Of Demand Flashcards by Shyam Gupta | Brainscape

Q

What is the cross elasticity of demand ( XED)

A

XED measures the responsiveness of quantity demanded of a good/service given a change in price of another

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Q

What is the formula for XED?

A

% CHANGE IN Quantity demanded of good A/ % CHANGE of price of good b

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Q

What XED does a substitute good have?

A

Positive

PARTY SEASON NEAR CHRISTMAS

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Q

What XED does a complement good have?

A

Negative

PARTY SEASON NEAR CHRISTMAS

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