The fact that the cross-price elasticity of natural gas with respect to the pric

Question

The fact that the cross-price elasticity of natural gas with respect to the price of fuel oil is 0.4 implies that natural gas and fuel oil are substitutes. natural gas is a normal good. the quantity of natural gas demanded will decrease by 1.6% when the price of fuel oil decreases by 4%. both a and c The fact that the cross-price elasticity of natural gas with respect to the price of fuel oil is 0.4 implies that natural gas and fuel oil are substitutes. natural gas is a normal good. the quantity of natural gas demanded will decrease by 1.6% when the price of fuel oil decreases by 4%. both a and c natural gas and fuel oil are substitutes. natural gas is a normal good. the quantity of natural gas demanded will decrease by 1.6% when the price of fuel oil decreases by 4%. both a and c

Explanation / Answer

natural gas and fuel oil are substitutes. as e<1 and also the quantity of natural gas demanded will decrease by 1.6% when the price of fuel oil decreases by 4%. as e=0.4

so ans :both a and c

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