Question: If the cross-price elasticity between two goods is negative, the two goods are classified as Choose: a. b. c. normal substitutes Your answer is

If the cross-price elasticity between two goods is negative, the two goods are classified as Choose: a. b. c. normal substitutes Your answer is correct. The market demand function for four-year private universities is given by the equation: Q 0.81 + o.gp whereQ pr is the number of applicants to private universities per year in thousands, P pr is the average price of private universities (in thousands of USD), I is the household monthly income (in thousands of IJSD), andP is the average price of public (government-supported) universities (in thousands of USD). Assume that P p, is equal to 38, I is equal to 100, and P pu is equal to 18. 0.1375 The cross-price elasticity of demand for private universities with respect to the average price of public universities:

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