Market research has produced the following estimates of cross elasticity of demand.
Branded cola and branded iced tea ...............................  +1.5
Branded cola and own label cola     ................................. +0.5

a. Explain what these estimates mean and their business significance for sales of branded cola when the price of branded iced tea and own label cola increase by 20%.

b. Using diagrams, explain how the market is likely to be affected by:
i. A substantial cut in the price of branded ice tea.
ii. A substantial increase in the price of branded cola.