Consumer buys 10 units of Good A when the price of Good B is $5. When the price of Good B rises to $6 (the price of Good A remaining unchanged) the consumer buys 14 units of Good A. Part A (6 MARKS) Using an appropriate formula, calculate this Consumer’s cross Elasticity of demand for Good A. Show your working. Part B (4 MARKS) Is Good A, a substitute for, or a complement to, Good B? Explain your reasoning.

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Consumer buys 10 units of Good A when the price of Good B is $5. When the price of Good B rises to $6 (the price of Good A remaining unchanged) the consumer buys 14 units of Good A.
Part A (6 MARKS)
Using an appropriate formula, calculate this Consumer’s cross Elasticity of demand for Good A. Show your working.
Part B (4 MARKS)
Is Good A, a substitute for, or a complement to, Good B? Explain your reasoning.

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