If two goods are complements,their cross-price elasticity of demand is:
A)less than 0.
B)equal to 0.
C)greater than 0.
D)impossible to determine without more information.

Question

Quizplus · Accepted Answer

If two goods are complements, an increase in the price of one good will lead to a decrease in the quantity demanded of the other good. This means that the cross-price elasticity of demand will be negative, indicating an inverse relationship between the prices of the two goods. Therefore, the correct choice is A) less than 0.

If Two Goods Are Complements,their Cross-Price Elasticity of Demand Is