Suppose the Price of Butter Increases by 5 Percent and the Amount

question 82

Multiple Choice

Suppose the price of butter increases by 5 percent and the amount of margarine purchased increases by 25 percent. What is the cross-price elasticity of demand between these two goods?

• A) 0.2
• B) 5
• C) 1.0
• D) −5.0

---

Definitions:

Intensity

The degree or strength of a quality, condition, or feeling.

Distributive Justice

The perceived fairness in the allocation of resources or rewards within a society or group.

Golden Rule

A moral imperative to treat others as one would wish to be treated oneself, often cited across various cultures and religions.

Utilitarian

An ethical philosophy that advocates for actions to be made based on their outcomes, specifically aiming to maximize overall happiness and reduce suffering.