Economists often use ________ as an indicator of substitutability.

Question

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Cross-elasticity of demand measures the responsiveness of the demand for a particular good to changes in the price of a related good. This is a key indicator of substitutability, as if there are many substitute goods available then a change in price of one good will have a greater effect on the demand for that good. Therefore, economists often use cross-elasticity of demand as an indicator of substitutability.

Economists Often Use ________ as an Indicator of Substitutability