Multiple Choice
The income elasticities of Products A and B and their cross-price elasticities with respect to Product C are as follows:??Income ElasticityCross-Price ElasticityProduct A+1.7-0.6Product B-0.8+0.9From this information, one can conclude that:
A) Product A is inferior, Product B is normal, Product A is a complement to Product C, and Product B is a substitute for Product C.
B) Product A is normal, Product B is inferior, Product A is a complement to Product C, and Product B is a substitute for Product C.
C) Product A is normal, Product B is inferior, Product A is a substitute for Product C, and Product B is a complement to Product C.
D) Product A is inferior, Product B is normal, Product A is a substitute for Product C, and Product B is a complement to Product C.
Correct Answer:
Verified
Correct Answer:
Verified
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