Question

A 10percent decreases in the price of dominos pizza decreases the demand for hamburger by 50 percentfind out the cross elasticy of demand between dominos pizza and hamburger

Answer 1

Solution

Cross Elasticity= $\frac{Percentage change in quantity of hamburger}{Percentage change in price of pizzaz}$

cross elasticity=$\frac{50}{10} = +5$

cross elasticity= 5