Advanced Placement (AP)

Janetta

20 March, 20:43

Jeffery Brooks has just landed a job as the produce manager for a large grocery store. The store manager mentioned that last summer a group of students had calculated that the cross elasticity of demand between cantaloupes and water melons to be $1.10. Jeffery should know that this means

A) people like cantaloupes 10% more than water melons.

B) people like water melons 110% more than cantaloupes.

C) a 10% increase in the price of cantaloupes will decrease the quantity demanded of water melons by 11%.

D) a $1 increase in the cost of either product will decrease the quantity purchased by 110 units per day.

E) a 10% increase in the price of cantaloupes will increase the quantity demanded of water melons by 11%.