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NeX [460]
2 years ago
15

Suppose the cross-elasticity of demand for products A and B is 3.6, and for products C and D is -5.4. What can you conclude abou

t how products A and B are related
Business
1 answer:
nikitadnepr [17]2 years ago
3 0

Answer:

A and B are substitutes

Explanation:

Cross price elasticity of demand measures the responsiveness of quantity demanded of good A to changes in price of good B.

If cross price elasticity of demand is positive, it means that the goods are substitute goods.

Substitute goods are goods that can be used in place of another good.

If the cross-price elasticity is negative, it means that the goods are complementary goods.

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ki77a [65]

Answer: Option C  

                                                                       

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Under this process large units are produced of a similar product. Such processes require high fixed cost and low variable cost.

From the above we can conclude that the correct option is C.

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What opportunities do global markets present for a potential business owner?
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