If the Cross-Price Elasticity of Demand Is -5,Good a and Good

question 106

Multiple Choice

If the cross-price elasticity of demand is -5,Good A and Good B are

• A) inferior goods.
• B) complements.
• C) substitutes.
• D) normal goods.
• E) luxury goods.

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Definitions:

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or choosing between options.

Comparative Advantage

The ability of an individual, firm, or country to produce a certain good or service at a lower opportunity cost than others.

Trade Deficit

The economic condition that arises when a country imports more goods and services than it exports.

Unfair Trade Practices

Business activities deemed unjust, deceptive, or fraudulent that can affect fair competition in the market.