WorksheetsXED II (Cross Elasticity of Demand)
Total questions: 10
Worksheet time: 6mins
Companies utilize cross-elasticity of demand for all the following EXCEPT:
Expand more branches of their business
Establish what price they should sell their goods for
Ascertain which goods are complements for their products
Ascertain which goods are substitutes for their products
Which of the following is TRUE about products with little or no substitutes?
They can be sold at lower prices
They can be sold at higher prices
They have negative XEDs
Their XEDs are zero (0)
Which of the following is TRUE about products that have close complements?
They can be sold at high prices to attract demand for their complements that are more expensive
They can be sold at cheaply to attract demand for their complements that are more expensive.
They have positive XEDs
Their XEDs are zero (0)
Some products have high XEDs this means:
They have no complements
Sales would decrease if you raise price
Sales would increase if you raise price
Sales are not affected by price
Some products have low XEDs this means:
They have no complements
Sales would drastically decrease if you raise price
Sales largely unaffected if you raise price
Sales are not affected by price
A measure of how the quantity demanded of one good responds to a change in the price of another.
PED
XED
YED
PES
XED formula.
None of the above
Multiple Answers Can Be Selected: Cross Elasticity of Demand shows if goods:
Independent
Sticky
Substitutes
Complements
If two products have a negative XED
They are unrelated
They are complements
They are substitutes
Both are inferior goods
If the cross elasticity of 2 products is 5.0, what are these two goods
Apples and Pineapples
Cars and Gasoline
Blue Tesla Model 3 and Red Tesla Model 3
MacBook and paper book
