The quantity demanded by product A increases 8% when the price of product B increases...
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Finance
The quantity demanded by product A increases 8% when the price of product B increases 16% and the other variables remain the same. a) Calculate the cross elasticity of demand. Products A and B, are they complementary or substitutes? Why? b) Drawing a graph, show the change in the demand curve to be perfectly inelastic, regardless of price? Explain your answer in detail.
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