Question: suppose a 5 decrease in the price of whole wheat...
Suppose a 5% decrease in the price of whole wheat bread produces a 10% increase in demand for whole wheat bread and a 15% increase in demand for butter.
a) computer the demand elasticity for whole wheat bread.
b) define the cross elasticity of demand for butter w/ respect to bread as percentage change in butter demand /(divided) percentage change in the price of whole wheat bread. compute the cross elascticity of butter w/ respect to whole wheat bread.