In September 2006, the Canadian Food Inspection Agency recommended that Canadians avoid eating imported raw spinach in the wake of an outbreak of E.coli bacteria in the United States.Following this recommendation, the food industry looked at alternatives and many turned to arugula.One U.S.distributor claimed, "The sale of the stuff has gone through the roof." Based on this information,

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The increased demand for arugula following the E.coli outbreak suggests that it is a substitute for raw spinach. Therefore, the cross-price elasticity between arugula and spinach is positive, meaning that as the price of spinach increases or there is a decrease in its availability, the demand for arugula increases. Option A is incorrect, as there is no evidence to suggest that raw spinach is an inferior good. Option B is incorrect, as a negative cross-price elasticity would indicate that the two goods are complements, meaning that as the price of one increases, the demand for the other decreases. Option D is also incorrect, as there is no information provided on the price elasticity of either arugula or spinach.

In September 2006, the Canadian Food Inspection Agency Recommended That