alleryStart learning →Cross elasticity of demand relates the quantity demanded of good A to the change in what?
AIncome of buyers
BPrice of good B
CAdvertising spend
DTax rate levied
Answer & Solution
Correct answer: B. Price of good B
Cross elasticity divides the percentage change in A's quantity by the percentage change in B's price.
Keep practising Law of Demand
Browse all Law of Demand questions for CA Foundation, or explore more Business Economics topics.
Related questions
A shop sells 200 units at Rs 50 each. Price rises to Rs 60 and sales fall to 160. What is A perfectly inelastic demand curve for a good is typical when the good has what?Keynesian economics is sometimes called what?The party with fewer opportunities to avoid a tax usually bears what share of its burden?When demand is perfectly inelastic, who bears the burden of a per-unit tax?The price of tea rises 10% and coffee demand rises 5%. What is the cross elasticity of cofWhich elasticity measures the effectiveness of a campaign in generating new sales?Along a straight-line demand curve, price elasticity of demand is what?