It is likely that the cross-price elasticity of demand between two goods produced by different firms in the same industry will be positive and large.

Question

Quizplus · Accepted Answer

In the same industry, goods produced by different firms are often substitutes for each other, meaning if the price of one good increases, consumers are likely to switch to the other good, leading to a positive and potentially large cross-price elasticity of demand.

It Is Likely That the Cross-Price Elasticity of Demand Between