What is
cross elatrisity?
Answers
Answer:
In economics, the cross elasticity of demand or cross-price elasticity of demand measures the percentage change of the quantity demanded for a good to the percentage change in the price of another good, ceteris paribus.
Explanation:
What is meant by cross elasticity?
–Definition: The measure of responsiveness of the demand for a good towards the change in the price of a related good is called cross price elasticity of demand. It is always measured in percentage terms. Related goods are of two kinds, i.e. substitutes and complementary goods.
What is the formula of cross elasticity?
Cross-Price Elasticity Formula
-Qx = Average quantity between the previous quantity and the changed quantity, calculated as (new quantityX + previous quantityX) / 2. Py = Average price between the previous price and changed price, calculated as (new pricey + previous pricey) / 2.