If the cross price elasticity of demand for tacos with respect to burritos equals +2.5, then:
A)a 1% increase in the quantity of burritos purchased will lead to a 2.5% increase in the price of a taco.
B)a 10% increase in the price of a burrito will lead to a 25% increase in the quantity of tacos demanded at a given price.
C)a 1% decrease in the price of a burrito will lead to a 2.5% increase in the quantity of tacos demanded at a given price.
D)a 1% increase in the quantity of tacos purchased will lead to a 2.5% increase in the price of a burrito.

Question

If the cross price elasticity of demand for tacos with respect to burritos equals +2.5, then:
A)​a 1% increase in the quantity of burritos purchased will lead to a 2.5% increase in the price of a taco.
B)​a 10% increase in the price of a burrito will lead to a 25% increase in the quantity of tacos demanded at a given price.
C)​a 1% decrease in the price of a burrito will lead to a 2.5% increase in the quantity of tacos demanded at a given price.
D)​a 1% increase in the quantity of tacos purchased will lead to a 2.5% increase in the price of a burrito.

Quizplus · Accepted Answer

The Answer of If the cross price elasticity of demand for tacos with respect to burritos equals +2.5, then:
A)​a 1% increase in the quantity of burritos purchased will lead to a 2.5% increase in the price of a taco.
B)​a 10% increase in the price of a burrito will lead to a 25% increase in the quantity of tacos demanded at a given price.
C)​a 1% decrease in the price of a burrito will lead to a 2.5% increase in the quantity of tacos demanded at a given price.
D)​a 1% increase in the quantity of tacos purchased will lead to a 2.5% increase in the price of a burrito.

If the Cross Price Elasticity of Demand for Tacos with Respect