If two goods are substitutes, their cross-price elasticity of demand is:
A) less than 0.
B) negative but almost equal to 0.
C) equal to 0.
D) greater than 0.

Name: If two goods are substitutes, their cross-price elasticity of demand is: A) less than 0. B) negative but almost equal to 0. C) equal to 0. D) greater than 0.
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Question

Quizplus · Accepted Answer

If two goods are substitutes, an increase in the price of one good will lead to an increase in the demand for the other good, resulting in a positive cross-price elasticity of demand.

If Two Goods Are Substitutes, Their Cross-Price Elasticity of Demand