the price of fanta is rs.10 and its demand is 100 bottles. the price of mirinda is also rs.10 but it decreases to rs.8 the demand for fanta goes down to 50 bottles. find cross price elasticity
Answers
Answered by
0
10×100=1000rs (fanta total price)
decreased fanta price =10×50= 500rs
mirinda =8×100=800rs
price elasticity
In economics, the cross elasticity of demand os-price elasticity of demand measures the responsiveness of the quantity demanded for a good to a change in the price of another good, ceteris paribus.
therefore price elasticity =1000-800
=200rs
Similar questions