Wilson Corporation has a major competitor that produces a product that is a close substitute for Wilson's good. If the coefficient of cross-elasticity of demand for Wilson's product with respect to the competitor's product is 2.00 and the competitor decreases its price by 5%, what is the expected effect in demand for Wilson's product?
a. A 5% increase in demand
b. A 5% decrease in demand
c. A 10% increase in demand
d. A 10% decrease in demand
Answer: d