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Goods a and B Have a Positive Cross-Price Elasticity of Demand

question 144

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Goods A and B have a positive cross-price elasticity of demand. This means goods A and B are:


Definitions:

Difference Threshold

The minimum difference in stimulation that a person can detect 50% of the time, also known as just noticeable difference (JND).

Sensory Adaptation

The process by which sensory receptors become less sensitive to constant stimuli over time.

Sensation

The process by which our sensory receptors and nervous system receive and represent stimuli from our environment.

Perception

The process by which individuals organize and interpret their sensory impressions in order to give meaning to their environment.

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