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The pair of items that is most likely to have a negative cross-price elasticity of demand...

The pair of items that is most likely to have a negative cross-price elasticity of demand is: A. mustard and aspirin. B. cashews and peanuts. C. coffee and tea. D. hamburgers and ketchup.

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Answer #1

Negative cross-price elasticity of demand means the increase in the price of one good leads to the decrease in the demand of the other good. Negative cross-price elasticity of demand is generally seen in complementary goods.

The pair of items that is most likely to have a negative cross-price elasticity of demand is:

D. hamburgers and ketchup.

Hamburgers and ketchup are complementary goods here, because one cannot consume hamburgers without ketchup. If there is a rise in the price of hamburgers then a fall in demand will be noticed of ketchup. Because due to the higher price of hamburgers the demand for hamburgers will decrease, and due to fall in demand of hamburgers there will be a fall in the demand of ketchup. Because hamburgers are consumed along with ketchup.

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