The cross price elasticity for peanut butter for a change in the price of jelly is likely to be
A)Negative
B)Zero
C)Positive and greater than 1
D)Positive and less than 1

Question

Quizplus · Accepted Answer

Peanut butter and jelly are typically complementary goods, so an increase in the price of jelly would likely decrease the demand for peanut butter, resulting in a negative cross price elasticity.

The Cross Price Elasticity for Peanut Butter for a Change