When the price of erasers increases from $1.50 to $2.50,the quantity demanded of pencils is unchanged.The cross-price elasticity of demand between erasers and pencils is ________ because erasers and pencils are ________.
A) 1; substitutes
B) 1/2 ; complements.
C) 0; normal goods
D) 0; unrelated
E) -1/2 ; complements

Question

When the price of erasers increases from $1.50 to $2.50,the quantity demanded of pencils is unchanged.The cross-price elasticity of demand between erasers and pencils is ________ because erasers and pencils are ________.
A)  1; substitutes
B)  1/2 ; complements.
C)   0; normal goods
D)  0; unrelated
E) -1/2 ; complements

Quizplus · Accepted Answer

The cross-price elasticity of demand between erasers and pencils is 0, which means they are unrelated goods. Therefore, none of the choices except for D are correct.

When the Price of Erasers Increases from $1