Suppose That a 10 Percent Increase in the Price of Normal

question 105

Multiple Choice

Suppose that a 10 percent increase in the price of normal good Y causes a 20 percent increase in the quantity demanded of normal good X. The coefficient of cross elasticity of demand is

• A) negative, and therefore these goods are substitutes.
• B) negative, and therefore these goods are complements.
• C) positive, and therefore these goods are substitutes.
• D) positive, and therefore these goods are complements.

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Definitions:

Machine Language

A low-level programming language that is directly understood by the computer's CPU, consisting of binary or hexadecimal instructions.

Low-Level Language

A Low-Level Language is a programming language that provides little or no abstraction from a computer's instruction set architecture, closer to machine code.

% Modulus

The operator used in arithmetic to find the remainder of division between two integers.

Common Use

A term describing typically frequent or widespread application or utilization of something.