A-LevelEconomicsThe price system and the microeconomy9708/12 · Oct/Nov 2014 · Q81 Mark

The price of good X rises by 10%. As a result, the demand for a substitute good Y rises by 20%. What is the cross-elasticity of demand for good Y with respect to the price of good X?

A+2

B+0.5

C-0.5

D-2

✓ Correct answer

A: +2

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Topic: The price system and the microeconomy, A-Level Economics (syllabus 9708). Multiple choice, 1 mark.
Source: A-Level Economics, Oct/Nov 2014 Paper 1 Variant 2, question 8.

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