The price of good X increases by 10%. As a consequence, demand for the substitute good Y increases by 20%. Calculate the cross-elasticity of demand for good Y with respect to the price of good X?
- A+2
- B+0.5
- C–0.5
- D–2
Economics 9708 · AS & A Level · Price elasticity of demand
The price of good X increases by 10%. As a consequence, demand for the substitute good Y increases by 20%. Calculate the cross-elasticity of demand for good Y with respect to the price of good X?