If the cross elasticity of demand coefficient between goods X and Y is negative, then goods X and Y must be
A)complements.
B)substitutes.
C)normal goods.
D)inferior goods.

Question

Quizplus · Accepted Answer

When the cross elasticity of demand coefficient between two goods is negative, it means that an increase in the price of one good leads to an increase in the demand for the other good, indicating that the two goods are complements.

If the Cross Elasticity of Demand Coefficient Between Goods X