In order for a maker of cellophane not to be charged with monopolizing the market, the cross- price elasticity of cellophane and other packaging products has to be:
A)high.
B)low.
C)not defined.
D)zero.

Question

Quizplus · Accepted Answer

If the cross-price elasticity of cellophane and other packaging products is high, it means that consumers can easily switch to substitute products if the price of cellophane rises too much. This indicates that cellophane is not a significant product in the market and the maker cannot be accused of monopolizing the market.

In Order for a Maker of Cellophane Not to Be