International Baccalaureate Economics (Chapter 3: Elasticities) Flashcards on 3.2: Cross Price Elasticity of Demand, created by Jasmine Wells on 10/01/2016.
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Created by Jasmine Wells
about 9 years ago
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Created by Jasmine Wells
about 9 years ago
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What is Cross price elasticity of demand (XED?)
What is the formula for XED?
What is the meaning of a positive XED?
Positive XED equals to...
What happens when the cross price of elasticity of demand between 2 goods is positive and it is he large?
What is the meaning of a negative XED?
Negative XED equals to...
What happens when the XED of 2 goods is negative and absolute value is large?
What occurs when the XED of 2 goods is equivalent to 0?
Why must a business take into careful consideration when producing substitutes?
Why must businesses be aware of substitutes being produced by rival businesses?
Why might a firm merge with another firm producing substitute of a good?
Why is knowledge of XED useful for complimentary products?
