Coke and Pepsi would likely have a:
A)more elastic cross-price elasticity of demand than Coke and Sunkist.
B)less elastic cross-price elasticity of demand than Coke and Sunkist.
C)measured cross-price elasticity of demand that is smaller than Coke and Sunkist.
D)None of these is true.

Question

Quizplus · Accepted Answer

Coke and Pepsi are close substitutes, so a change in the price of one would significantly affect the demand for the other, resulting in a more elastic cross-price elasticity of demand compared to Coke and Sunkist, which are not as closely related.

Coke and Pepsi Would Likely Have A