Final answer:
Based on the provided values, McDonald's Hamburgers and Burger King Hamburgers are the strongest substitutes with a cross-price elasticity of +0.82, while Wendy's French Fries and Heinz Ketchup are the strongest complements with a cross-price elasticity of -0.45.
Step-by-step explanation:
The cross-price elasticity of demand measures the responsiveness of the quantity demanded for one good when the price for another good changes. Substitute goods are identified by positive cross-price elasticities of demand, indicating that an increase in the price of one leads to a higher demand for the other. Conversely, complement goods have negative cross-price elasticities because an increased price for one results in a lower demand for the other.
Given the cross-price elasticities provided:
- Coke and Pepsi = +0.64
- McDonald's Hamburgers and Burger King Hamburgers = +0.82
- Wendy's French Fries and Heinz Ketchup = -0.45
- High-Fueling SUV's and gasoline = -0.28
McDonald's Hamburgers and Burger King Hamburgers with cross-price elasticity of +0.82 are the strongest substitutes, as the positive value indicates a strong substitution effect. On the other hand, Wendy's French Fries and Heinz Ketchup, with cross-price elasticity of -0.45, are the strongest complements, since the negative value suggests a strong complementary relationship.