Hot dogs and hot dog buns are found to be related by the cross elasticity of demand.If they are complementary goods, the cross elasticity will be
A)positive.
B)equal to zero.
C)negative.
D)unknown.

Question

Quizplus · Accepted Answer

When two goods are complementary, their cross elasticity of demand is negative. This means that if the price of one good (e.g. hot dogs) increases, the quantity demanded of the other good (e.g. hot dog buns) will decrease, and vice versa. Therefore, the correct choice is C, negative.

Hot Dogs and Hot Dog Buns Are Found to Be