The cross elasticity of demand measures the responsiveness of the quantity demanded of a particular good to changes in the prices of
A) its substitutes and its complements.
B) its substitutes but not its complements.
C) its complements but not its substitutes.
D) neither its substitutes nor its complements.

Question

Quizplus · Accepted Answer

Cross elasticity of demand measures how the quantity demanded of one good changes in response to a price change in another good, which can be either a substitute or a complement.

The Cross Elasticity of Demand Measures the Responsiveness of the Quantity