If a cross-elasticity with respect to price is positive, then the two brands or products in question are considered to be
A) Competitive
B) National brands
C) Home brands
D) Accommodative
E) Monopolistic

Question

Quizplus · Accepted Answer

When the cross-elasticity of demand with respect to price is positive, it indicates that as the price of one product increases, the demand for another product also increases, suggesting that the two products are substitutes for each other, hence competitive.

If a Cross-Elasticity with Respect to Price Is Positive, Then