A cross-price elasticity value that is positive will indicate goods that are substitutes.

Name: A cross-price elasticity value that is positive will indicate goods that are substitutes.
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Question

Quizplus · Accepted Answer

A positive cross-price elasticity value indicates that when the price of one good increases, the demand for the other good also increases. This suggests that the two goods are substitutes, meaning that consumers can easily switch between them based on price changes.

A Cross-Price Elasticity Value That Is Positive Will Indicate Goods