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Suppose there are two goods, good C and good D. the cross-price elasticity of demand for these two goods is equal to - 0.8.
a. What is the relationship between good C and good D? Explain your answer.
b. Given that the cross price elasticity of demand is positive and you as a shop owner would like to sell more units of one of these goods. What do you hope will happen to the price of the other good? Explain your answer
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