객관식
An increase in the demand for chicken, from 8,000 to 12,000, was caused by an increase in the price of beef from \$4.50 to \$5.50. Therefore, the cross-price elasticity for these two products is:
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4. Elasticity
Cross-Price Elasticity of Demand
객관식
What is cross-price elasticity of demand?
A
The percentage change in the price of one good divided by the percentage change in the price of another good; measures the relative price movements between goods.
B
The percentage change in quantity demanded of one good divided by the percentage change in the price of a different good; measures how demand for one good responds to price changes of another.
C
The percentage change in quantity demanded of a good divided by the percentage change in its own price; measures demand responsiveness to its own price.
D
The percentage change in quantity demanded of a good divided by the percentage change in consumers' income; measures how demand responds to income changes.
검증된 단계별 안내1
Understand that cross-price elasticity of demand measures how the quantity demanded of one good responds to changes in the price of a different good.
Recall the formula for cross-price elasticity of demand: \(\text{Cross-price elasticity} = \frac{\% \text{ change in quantity demanded of Good A}}{\% \text{ change in price of Good B}}\).
Note that this elasticity helps determine whether two goods are substitutes or complements: a positive value indicates substitutes, while a negative value indicates complements.
Distinguish cross-price elasticity from own-price elasticity, which measures responsiveness of quantity demanded to changes in the good's own price, and from income elasticity, which relates to changes in consumer income.
Summarize that cross-price elasticity focuses on the relationship between two different goods, specifically how the price change of one affects the demand for the other.
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