substitutes, complements, or unrelated

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You work for a marketing firm that has just landed a contract with RunoftheMills to help them promote three oftheir products: splishy splashies, flopsicles, and cannies. All of these products have been on the market for sometime, but, to entice better sales, RunoftheMills wants to try a new advertisement that will market two of theproducts that consumers will likely consume together. As a former economics student, you know that complementsare typically consumed together while substitutes can take the place of other goods.RunoftheMills provides your marketing firm with the following data: When the price of splishy splashies increasesby 2%, the quantity of flopsicles sold increases by 6% and the quantity of cannies sold decreases by 1%. Your job isto use the crossprice elasticity between splishy splashies and the other goods to determine which goods yourmarketing firm should advertise together.

Rahul Sunny answered 1 year ago

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