The Cross-Price Elasticity of Demand Refers To

question 101

Multiple Choice

The cross-price elasticity of demand refers to:

• A) a change in the demanded for two goods, following a change in the price of one good.
• B) the substitution of one good for another as the prices of two goods change.
• C) the value of price elasticity at which supply crosses demand.
• D) the percentage change in the quantity demanded of one good resulting from a 1-percent increase in the price of another good.

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Definitions:

Standard Deviation

A statistical measure of the dispersion or variability of a data set around its mean.

Frequency Distribution

A statistical representation showing the number of instances in which a variable takes each of its possible values.

Linear Regression Line

A line that approximates the points on a scatterplot which can be used to show a trend and make predictions; also called a line of best fit or least squares line.

Scatterplot

A graph that shows the relationship of bivariate data using points on the coordinate grid.