Looking for trustworthy answers? Westonci.ca is the ultimate Q&A platform where experts share their knowledge on various topics. Discover comprehensive solutions to your questions from a wide network of experts on our user-friendly platform. Join our Q&A platform to connect with experts dedicated to providing accurate answers to your questions in various fields.
Sagot :
The price elasticity of a good will tend to be larger if the fewer number of substitute goods will be available.
The cross elasticity of demand for substitute goods is always positive because the demand of one good increases at the time when the price for the substitute good increases however the cross elasticity of demand for complementary goods is always negative.
For example, if the price of coffee rises, the quantity demanded for tea which is the best substitute of coffee beverage will increase as consumers will switch to a less expensive but the substitutable alternative.
This is reflected in the cross elasticity of the demand formula, as both the numerator which is the percentage change in the demand of tea and denominator which is the price of coffee shows a positive increase.
To know more about price elasticity of demand here:
https://brainly.com/question/13565779
#SPJ4
Thanks for stopping by. We strive to provide the best answers for all your questions. See you again soon. Thanks for using our service. We're always here to provide accurate and up-to-date answers to all your queries. Stay curious and keep coming back to Westonci.ca for answers to all your burning questions.
