If commodities X and Y are substitute their cro... - JAMB Economics 2023 Question
If commodities X and Y are substitute, their cross elasticity of demand will be
A
One
B
positive
C
negative
D
zero
correct option: b
If commodities X and Y are substitutes, their cross elasticity of demand will be positive. Substitutes are goods that can be used in place of each other. When the price of one substitute (e.g., X) increases, the demand for the other substitute (e.g., Y) tends to increase as consumers shift their preference. As a result, the cross elasticity of demand is positive.
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