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If a Price Hike of 5 Percent Increases the Quantity

Question 277

Multiple Choice

If a price hike of 5 percent increases the quantity demanded of another good by 2 percent, the goods must be ________ and the cross elasticity of demand equals ________.


A) substitutes; 0.40
B) substitutes; 2.5
C) complements; 0.40
D) complements; 2.5

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