When lettuce prices doubled, from about $1.50 per head to about $3.00, the reaction of one consumer was quoted in a newspaper article: “I will not buy [lettuce] when it’s

$3 a head,” she said, adding that other green vegetables can fill in for lettuce. “If bread were $5 a loaf we’d still have to buy it. But lettuce is not that important in our family.”

a. For this consumer’s household, which product has the higher price elasticity of demand: bread or lettuce?

Briefly explain.

b. Is the cross-price elasticity of demand between lettuce and other green vegetables positive or negative for this consumer? Briefly explain.

Source: Justin Bachman, “Sorry, Romaine Only,” Associated Press, March 29, 2002.