If the price of running shoes increases 5% and the quantity demanded for flip-flops increases 10%, the cross price elasticity of demand is two (10% divided by 5%).

If the price of running shoes increases 5% and the quantity demanded for flip-flops increases 10%, the cross price elasticity of demand is two (10% divided by 5%).

These factors can cause demand elasticity even in goods that do not change. Let's say two kinds of butter are at the store, one for $1 and one for $2.

In economics, the cross price elasticity of demand measures the responsiveness of the quantity demanded of one good (X), to a change in the price of another good (Y). As gas prices have soared ...

The price elasticity of demand, to use its full name, measures how sensitive buyers are to price changes. Typically, when the price of, say, a can of Coke goes up, people buy fewer cans or switch ...