If the Cross Elasticity of Demand Between Peanut Butter and Jelly

question 61

Multiple Choice

If the cross elasticity of demand between peanut butter and jelly is negative,then

• A)a rise in the price of peanut butter results in a rise in the equilibrium price of jelly.
• B)a rise in the price of peanut butter results in a fall in the equilibrium price of jelly.
• C)a rise in the price of peanut butter has no effect on the equilibrium price of jelly.
• D)a fall in the price of peanut butter results in a fall in the equilibrium price of jelly.
• E)peanut butter and jelly are substitutes.

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Definitions:

Discrimination Coefficient

A statistical measure in economics or social science indicating the degree to which a variable, such as price or income, discriminates or differentiates between individuals or groups.

Wage Differential

Wage differential refers to the variation in wages between individuals, occupations, locations, or sectors due to factors like skill level, demand, or cost of living.

Nonpreferred-Race Workers

Employees who are perceived or categorized as belonging to a racial or ethnic group that is less favored or discriminated against within a societal or organizational context.

Statistical Discrimination

A decision-making process that uses statistical or probability information on groups rather than individuals, leading to potential biases.