If,for Two Goods,the Cross-Price Elasticity of Demand Is 1

question 354

Multiple Choice

If,for two goods,the cross-price elasticity of demand is 1.25,then

• A) the two goods are luxuries.
• B) the two goods are substitutes.
• C) one of the goods is normal and the other good is inferior.
• D) the demand for one of the goods conforms to the law of demand,but the demand for the other good violates the law of demand.

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Definitions:

Adrenal Gland

A gland above the kidney that produces hormones such as adrenaline and cortisol, which help control heart rate, blood pressure, and other important bodily functions.

Cortisol

A steroid hormone released by the adrenal glands in response to stress or low blood-glucose concentration.

Blood Sugar Levels

The concentration of glucose in the blood, which is a critical aspect of metabolic health and energy supply for the body.

Energy

The capacity to do work or produce change, existing in various forms such as kinetic, potential, thermal, electrical, chemical, and nuclear.