1.9 In 1947, the U.S. Department of Justice brought a suit against the DuPont Company (which at the time sold 75 percent of all the cellophane in the United States)

for monopolizing the production and sale of cellophane.

In court, the DuPont Company tried to show that cellophane was only one of several goods in the market in which it was sold. It argued that its market was not the cellophane market but the “flexible packaging materials”

market, which included (besides cellophane) waxed paper, aluminum foil, and so forth. DuPont pointed out that it had only 20 percent of all sales in this more broadly defined market. Using this information, discuss how the concept of cross elasticity of demand would help establish whether DuPont should have been viewed as a firm in the cellophane market or as a firm in the

“flexible packaging materials” market.