If the Cross Elasticity of Demand for Good a with Respect

question 143

Multiple Choice

If the cross elasticity of demand for good A with respect to good B is +2.7, then good A is

• A)an inferior good.
• B)a normal good.
• C)a substitute for good B.
• D)a complement to good B.

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Definitions:

Straight Rebuy

Describes a routine repurchase of the same goods or services without modification, often made by businesses from previous suppliers.

Buying Process

The series of steps a consumer goes through, from recognizing a need or desire to the final purchase decision, including information search, evaluation of options, and post-purchase evaluation.

Modified Rebuy

A buying situation where an organization makes changes to its previous purchase orders, involving modifications in product specifications, prices, or suppliers.

New Buy

A purchasing situation in which a buyer purchases a product or service for the first time, presenting a significant decision-making process.