If the cross price elasticity of demand between goods A and B was equal to 0.5, those goods are substitutes.

Name: If the cross price elasticity of demand between goods A and B was equal to 0.5, those goods are substitutes.
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Question

Quizplus · Accepted Answer

A positive cross price elasticity of demand indicates that as the price of one good increases, the demand for the other good also increases, which is characteristic of substitute goods.

If the Cross Price Elasticity of Demand Between Goods a and B