Practicing Success
What is the elasticity of demand called if it measures the responsiveness of the quantity demanded of a good, to change in price of other goods? |
price elasticity of demand income elasticity of demand cross elasticity of demand none of them |
cross elasticity of demand |
Cross elasticity of demand measures the degree of responsiveness in the quantity demanded of one commodity to the change in price of the OTHER commodity. Now this other commodity can be either a substitute good or a complementary good. |