The cross-price elasticity of demand for peanut butter with respect to
The cross-price elasticity of demand for peanut butter with respect to the price of jelly is -0.3. If we expect the price of jelly to decline by 15%, what is the expected change in the quantity demanded for peanut butter?
A) +15%
B) +45%
C) +4.5%
D) -4.5%
ANSWER
C
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