explain xed value
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uuid: d6b6e3dd-1bba-466a-aad8-9e39c68280ab
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---
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# Cross Elastic Demand (XED)
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The equation given in the lecture slides is:
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$$\text{XED} = \frac{\frac{\Delta q_A}{q_A}}{\frac{\Delta p_B}{p_B}}$$
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@ -17,6 +19,9 @@ $$\text{XED}
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= \frac{\text{percentage change in quantity of A}}{\text{percentage change in price of B}}
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$$
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If XED is positive, the two goods A and B are substitutes for each other.
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If XED is negative, the two goods are complimentary.
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## Example
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![A question from the book (page 91)](./images/xed_question.png)
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