Rachel is hosting a party at her house and plans to grill hotdogs. The price
for a package of hotdog buns has increased by 30%. Rachel decides she
will buy 20% fewer hotdogs than she did last year.
Using the cross-price elasticity formula, the cross-price elasticity is
and the goods are
a.) 1.5; substitutes
b.) -0.67; complements
c.) 2; substitutes
d.) -1; complements