When price of tea in local café rises from 10 to 15 per cup demand fo – InterviewSolution

1.	When price of tea in local café rises from 10 to 15 per cup demand for coffee rises from 3000 to 5000 cups a day despite no change in coffee prices Find cross price elasticity and based on the result what kind of relation exists between the two goods.
Answer» tion:In CASE that are two goods that are tea and COFFEE are substitutes to each other , In other words these are substitutes good that is if price of ONE good increase the demand and SUPPLY for energy is decrease. The CROSS price elasticity Will be positive.

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