The Cross-Price Elasticity Between Gillette Razors and a Related Good

question 265

Multiple Choice

The cross-price elasticity between Gillette razors and a related good is -3.4.What happens to the demand for the related good if the price of Gillette razors falls by 10 percent?

• A)The quantity demanded of the related good rises by 3.4 percent.
• B)The quantity demanded of the related good falls by 34 percent.
• C)The quantity demanded of the related good rises by 34 percent.
• D)The quantity demanded of the related good falls by 3.4 percent.