Good X and Good Y Are Related Goods

question 136

Multiple Choice

Good X and Good Y are related goods. When the price of good X rises by 20 percent, the quantity demanded for good Y falls by 40 percent. What is the cross-price elasticity?

• A) 2
• B) 4
• C) -0.5
• D) -2

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Definitions:

Cash Management

The process of collecting, managing, and investing a company's cash in a way that optimizes its liquidity, investment return, and risk levels.

Receivables

Amounts owed to a business by its customers for goods or services delivered but not yet paid for.

Expenditures

The flow of cash or cash-equivalent amounts paid out by a company to meet obligations or purchase goods and services.

Bank Statement

A monthly summary provided by a bank, detailing all transactions that have occurred in an account.