Editing Elasticity (economics) (section)

=== Cross-price elasticity of demand ===
{{main|Cross elasticity of demand}}
[[File:Cross-Price Elasticity.jpg|thumb|412x412px|Formula for cross-price elasticity]]
[[Cross elasticity of demand|Cross-price elasticity of demand]] (or cross elasticity of demand) measures the sensitivity between the quantity demanded in one good when there is a change in the price of another good.<ref name=":0">{{Cite web|last=Hayes|first=Adam|title=Understanding the Cross Elasticity of Demand|url=https://www.investopedia.com/terms/c/cross-elasticity-demand.asp|access-date=2021-04-25|website=Investopedia|language=en}}</ref> As a common elasticity, it follows a similar formula to price elasticity of demand. Thus, to calculate it the percentage change in the quantity of the first good is divided by the percentage change in price in the second good.<ref name=":0" /> The related goods that may be used to determine sensitivity can be [[Complementary good|complements]] or [[Substitute good|substitutes]].<ref name=":2" /> Finding a high-cross price elasticity between the goods may indicate that they are more likely substitutes and may have similar characteristics.<ref>{{Cite journal|last1=Kolay|first1=Sreya|last2=Tyagi|first2=Rajeev, K.|date=2018|title=Product Similarity and Cross-Price Elasticity|journal=Review of Industrial Organization|volume=52|pages=85–100|doi=10.1007/s11151-017-9578-8|s2cid=157974644|via=Springer Link}}</ref> If cross-price elasticity is negative, the goods are likely to be [[complement good|complements]].

Real-world examples of cross-price elasticity:<ref>{{cite book |last1=MOTTA |first1=DOBRESCU |title=PRINCIPLES OF ECONOMICS |date=March 2019 |publisher=LIONSHEART STUDIOS |pages=64–80 |edition=FOURTH }}</ref>

{| class="wikitable"
|-
| '''Product Under Investigation''' || '''Comparison Product''' || '''Price Elasticity'''
|-
| US Domestic Tuna || Imported Tuna || 0.45
|-
| US Domestic Tuna || Bread || -0.33
|-
| US Domestic Tuna || Ground Meat || 0.3
|-
| Beer || Wine || 0.2
|-
| Beer || Soft Drinks || 0.3
|-
| Transit || Automobiles || 0.85
|-
| Transportation || Recreation || -0.05
|-
| Food || Recreation || 0.15
|-
| Clothing || Food || -0.18
|}