A negative cross-price-elasticity of demand for two products indicates that they are:
A) substitutes.
B) complements.
C) independent goods.
D) normal goods.

Question

Quizplus · Accepted Answer

A negative cross-price elasticity of demand means that an increase in the price of one product leads to a decrease in the demand for the other product. This is the characteristic of complementary goods, which are typically consumed together (such as hot dogs and hot dog buns).

A Negative Cross-Price-Elasticity of Demand for Two Products Indicates That