The Cross-Price Elasticity of Demand Between Milk and Soft Drinks

question 15

Multiple Choice

The cross-price elasticity of demand between milk and soft drinks is likely to be

• A)negative because the goods are complements
• B)positive because the goods are complements
• C)negative because the goods are substitutes
• D)positive because the goods are substitutes
• E)0 because the goods are not usually consumed by the same person at one time

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Definitions:

Economic Advantages

Benefits that contribute to a stronger financial position, such as increased income, market dominance, or efficient resource utilization.

Considerable Emphasis

Significant importance or stress placed on a particular aspect or detail.

State

An organized political community under one government, recognized as sovereign or independent.

Inequality

A situation where resources, opportunities, and rights are distributed unevenly amongst individuals or groups in a society.