{"id":55325,"date":"2024-04-16T00:25:27","date_gmt":"2024-04-16T00:25:27","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=55325"},"modified":"2024-04-16T00:25:27","modified_gmt":"2024-04-16T00:25:27","slug":"if-a-change-in-the-price-of-one-of-good-causes-a-change-in-quantity-demand-then-the-cross-elasticity-of-demand-between-them-is","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/if-a-change-in-the-price-of-one-of-good-causes-a-change-in-quantity-demand-then-the-cross-elasticity-of-demand-between-them-is\/","title":{"rendered":"If a change in the price of one of good causes a change in quantity demand, then the cross elasticity of demand between them is"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;Negative&#8221; option2=&#8221;Positive&#8221; option3=&#8221;Zero&#8221; option4=&#8221;One&#8221; correct=&#8221;option1&#8243;]<!--more--><\/p>\n<p>The correct answer is A. Negative.<\/p>\n<p>Cross elasticity of demand is a measure of how responsive the demand for one good is to a change in the price of another good. It is calculated by dividing the percentage change in the quantity demanded of one good by the percentage change in the price of another good.<\/p>\n<p>If a change in the price of one good causes a decrease in the quantity demanded of another good, then the cross elasticity of demand between them is negative. This is because the two goods are substitutes. For example, if the price of coffee increases, people may demand less tea, because coffee and tea are substitutes.<\/p>\n<p>If a change in the price of one good causes an increase in the quantity demanded of another good, then the cross elasticity of demand between them is positive. This is because the two goods are complements. For example, if the price of cars increases, people may demand more gasoline, because cars and gasoline are complements.<\/p>\n<p>If a change in the price of one good has no effect on the quantity demanded of another good, then the cross elasticity of demand between them is zero. This is because the two goods are unrelated. For example, if the price of coffee increases, people may not demand more or less sugar, because coffee and sugar are unrelated.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;Negative&#8221; option2=&#8221;Positive&#8221; option3=&#8221;Zero&#8221; option4=&#8221;One&#8221; correct=&#8221;option1&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-55325","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>If a change in the price of one of good causes a change in quantity demand, then the cross elasticity of demand between them is<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/if-a-change-in-the-price-of-one-of-good-causes-a-change-in-quantity-demand-then-the-cross-elasticity-of-demand-between-them-is\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"If a change in the price of one of good causes a change in quantity demand, then the cross elasticity of demand between them is\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;Negative&#8221; 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