If the amounts of two commodities purchased both increase or decrease when the price of one change, the cross elasticity of demand between them is:

CA Foundation · Business Economics · MTP · January 2026
If the amounts of two commodities purchased both increase or decrease when the price of one change, the cross elasticity of demand between them is:
(A) A. Negative
(B) B. Positive
(C) C. Zero
(D) D. 1

Suggested Answer and Working Notes:

Correct Answer: Option (A)

A. Negative

Topics: Theory of Demand and Supply

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