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1.2.3 Price, income and cross elasticities of demand

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Question 4

High-end cinema cameras and compatible proprietary solid-state storage cards (SSDs) are complementary goods with an estimated cross elasticity of demand of -2.5. Currently, 85,000 of these SSDs are sold globally each year.

With reference to the information provided, calculate the new quantity demanded of these proprietary SSDs per year, following a 6% decrease in the price of high-end cinema cameras. You are advised to show your working.

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1.2.3 Price, income and cross elasticities of demand Questions

  1. A Level
  2. /Economics
  3. /1.2.3 Price, income and cross elasticities of demand