What is he cross price elasticity of demand for coffee and tea is likely to be called?

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2026-04-16 03:35

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The cross-price elasticity of demand for coffee and tea is likely to be positive, indicating that they are substitute goods. This means that as the price of coffee increases, the demand for tea may also increase, as consumers may switch to tea as an alternative. Conversely, if the price of tea rises, the demand for coffee could also rise. A positive cross-price elasticity reflects the relationship between these two beverages as substitutes in consumption.

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