If the Cross-Price Elasticity of Two Goods Is Positive,then the Two

question 147

Multiple Choice

If the cross-price elasticity of two goods is positive,then the two goods are

• A)substitutes.
• B)complements.
• C)normal goods.
• D)inferior goods.

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Definitions:

Marginal Cost

The charges incurred from the production of an extra unit of a product or service.

Short-run Profits

Profits earned by a firm when it operates under short-term constraints, where at least one input is fixed.

Average Total Cost

The total cost of production divided by the number of units produced, representing the average cost per unit of output.

Average Total Cost

The overall expense of manufacturing divided by the quantity of products made, indicating the expense for each unit of production.