The cross-price elasticity of demand for a good is the:
A) percentage change in the quantity demanded for a good due to a percentage change in the consumer's income.
B) percentage change in the quantity demanded for a good due to a percentage change in the good's price.
C) percentage change in the quantity demanded for a good due to a percentage change in tax rates.
D) percentage change in the quantity demanded for a good due to a percentage change in the price of related goods.
Question 2
If a government action is designed to achieve efficiency, then the action must have the market produce the amount of output so that the
A) marginal private cost equals the marginal private benefit.
B) marginal social cost equals the marginal social benefit.
C) marginal external cost equals the marginal external benefit.
D) marginal private cost equals the tax.
E) marginal social benefit exceeds the marginal social cost by as much as possible.
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