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The cross-price elasticity of coffee with respect to muffins is -2, with respect to tea is 3 Are coffee and muffins normal goods, inferior goods,

The cross-price elasticity of coffee with respect to muffins is -2, with respect to tea is 3

  1. Are coffee and muffins normal goods, inferior goods, complementary goods or substitute goods? how about coffee and tea? (1mark)
  2. if the increase in the price of muffins is 10%, calculate the changein quantity demanded in the coffee market. (2marks)
  3. if the increase in the price of coffee is 10%, calculate the changeinquantity demandedin the tea market. (2marks)

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