The cross-price elasticity of demand of products "A" and "B" is zero. This implies that "A" and "B" are
A) substitute products.
B) complementary products.
C) independent products.
D) unique goods, as the price elasticity of demand for one of them is zero.

Question

Quizplus · Accepted Answer

Zero cross-price elasticity of demand implies that the demand for product "A" does not depend on the price of product "B" and vice versa. Therefore, "A" and "B" are independent products.

The Cross-Price Elasticity of Demand of Products "A" and "B