Consider the following pairs of items:
a.shampoo and conditioner
b.iPhones and earbuds
c.a laptop computer and a desktop computer
d.beef and pork
e.air-travel and weed killer
Which of the pairs listed will have cross-price elasticity of zero?
A) a and b only
B) c only, since most people cannot do without computers
C) e only
D) None of the pairs listed

Question

Consider the following pairs of items: 
a.shampoo and conditioner
b.iPhones and earbuds
c.a laptop computer and a desktop computer
d.beef and pork
e.air-travel and weed killer
Which of the pairs listed will have cross-price elasticity of zero?
A) a and b only
B) c only, since most people cannot do without computers
C) e only
D) None of the pairs listed

Quizplus · Accepted Answer

Air-travel and weed killer are unrelated goods, so a change in the price of one does not affect the demand for the other, resulting in a cross-price elasticity of zero.

Consider the Following Pairs of Items