The cross elasticity of demand between two goods, X and Y, is +1.8. Good Y has an income elasticity of demand of –0.6. If consumers’ incomes rise and the price of good Y also rises, which combination of effects will occur?
- Aquantity demanded of X: fall; quantity demanded of Y: fall
- Bquantity demanded of X: fall; quantity demanded of Y: rise
- Cquantity demanded of X: rise; quantity demanded of Y: fall
- Dquantity demanded of X: rise; quantity demanded of Y: rise