If the Cross-Price Elasticity of Demand Between Good X and Good

Multiple Choice

If the cross-price elasticity of demand between Good X and Good Y is 0.4,then _____

A) the demand for Good X is highly responsive to changes in the price of Good Y.
B) a 10 percent increase in the price of Good Y leads to a 0.4 percent increase in the quantity demanded of Good X.
C) a 10 percent decrease in the price of Good Y leads to a 4 percent decrease in the demand for Good Y.
D) Good X and Good Y are complements.
E) Good X is a normal good and Good Y is an inferior good.