Question
A store recently marked a hydration belt on sale, lowering the price from $20 to $12. The store also sells a hydration bottle, which has
A store recently marked a hydration belt on sale, lowering the price from $20 to $12. The store also sells a hydration bottle, which has a similar concept to the belt, except that a runner can hold it in his or her hand with a strap while running. When the store owner lowered the price of the hydration belt, he noticed that the quantity of hydration bottles that he sold decreased from seven the previous week to five, as more people chose to buy the belt. Using the mid-point formula, the cross-price elasticity is __________ and the goods are __________.
- a.)
- b.)
- c.)
- d.)
0.667; substitutes
-1.333; complements
1.005; substitutes
-0.714; complements
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