WAEC - Economics (2011 - No. 7)
If a 20% rise in price of Whiskey leads to a 30% increase in quantity demanded of Schnapps, the cross elasticity of demand is
3.0
2.5
2.3
1.5
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It is calculated by taking the percentage change in the quantity demanded of one good and dividing it by the percentage change in the price of the other good.
Hence we; 30/20 = 1.5