Question

the price of dog leashes increased 5% and the quantity demanded of dog collars decreased 7%. calculate the cross-price elasticity of demand for dog collars. round your answer to the nearest hundredth. be sure to include a negative sign in your answer, if necessary.

Answer 1

-1.4

Step-by-step explanation:

Cross price elasticity of demand is calculated by dividing the percentage change in the demand of one good divided by the percentage change in price of another good

Percentage change in price of Dog leashes = 5%

Percentage change in quantity demanded of dog collars = -7%

Cross price elasticity = percentage change in quantity of dog collars / percentage change in price of dog lashes

=-7/5*100= -1.4