Suppose the Cross-Price Elasticity of Demand Between Goods X and Y

question 87

Multiple Choice

Suppose the cross-price elasticity of demand between goods X and Y is 0.15 and the cross-price elasticity of demand between goods X and Z is 1.3. Which of the following statements is true?

• A) X and Y are complements, while X and Z are substitutes.
• B) X and Y are weak complements, while X and Z are strong complements.
• C) X and Y are strong complements, while X and Z are weak complements.
• D) Y is a necessity and Z is a luxury.

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Definitions:

Functional Structure

An organizational design where the company is divided into departments based on special functions such as marketing, finance, and production.

Technical Knowledge

Specific expertise or skills related to a particular field or technology, necessary for performing tasks and solving problems within that domain.

Similar Skills

Abilities or competencies that are alike or nearly identical among individuals or within groups.

Geographical Structures

Organizational structures that are based on the geographical location of facilities, resources, or markets, often used to address specific regional requirements or strategies.