Question 5 The price of input X decreases by 15%. In response, the quantity of input Y demanded increases by 6%. We would conclude: O that X and Y are substitute inputs and the cross-elasticity of factor demand is equal to 2.50 O that X and Y are complementary inputs and the cross-elasticity of factor demand is equal to -2.50 O that X and Y are substitute inputs and the cross-elasticity of factor demand is equal to 0.40 O that X and Y are complementary inputs and that the cross-elasticity of factor demand is equal to -0.40
Question 5 The price of input X decreases by 15%. In response, the quantity of input Y demanded increases by 6%. We would conclude: O that X and Y are substitute inputs and the cross-elasticity of factor demand is equal to 2.50 O that X and Y are complementary inputs and the cross-elasticity of factor demand is equal to -2.50 O that X and Y are substitute inputs and the cross-elasticity of factor demand is equal to 0.40 O that X and Y are complementary inputs and that the cross-elasticity of factor demand is equal to -0.40
Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter26: Factor Markets: With Emphasis On The Labor Market
Section: Chapter Questions
Problem 14QP
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