The cross price elasticity for low mpg (miles per gallon; gas mileage)cars for a change in the price of gasoline is likely to be

Question

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The cross price elasticity of demand measures how the quantity demanded of one good responds to a price change of another good. For low mpg cars, an increase in gasoline prices typically leads to a decrease in demand for these cars, as they become more expensive to operate. This inverse relationship results in a negative cross price elasticity.

The Cross Price Elasticity for Low Mpg (Miles Per Gallon;