Suppose the Cross-Price Elasticity Between Demand for Chipotle Burritos and the Price

question 47

Multiple Choice

Suppose the cross-price elasticity between demand for Chipotle burritos and the price of Qdoba burritos is 0.8.If Qdoba increases the price of its burritos by 10%:

• A)Chipotle will sell 10% more burritos.
• B)Chipotle will sell 8% more burritos.
• C)Chipotle will sell 8% fewer burritos.
• D)We cannot tell what will happen to Chipotle,but Qdoba will sell 8% fewer burritos.

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