Answer: The value of cross price elasticity is 1.6.
Step-by-step explanation:
Since we have given that
Percent change in price = 10%
Percent change in quantity = 16%
So, we need to find the cross price elasticity between the two movie club memberships.
As we know the formula for cross price elasticity :
[tex]\dfrac{\%\text{change in demand}}{\%\text{change in price}}\\\\=\dfrac{16}{10}\\\\=1.6[/tex]
Hence, the value of cross price elasticity is 1.6.
