Answer
If an increase in the price of beer would reduce the amount of marijuana consumed, the cross elasticity of demand between the two products is negative. This means that when the price of one product (in this case, beer) increases, the demand for the other product (in this case, marijuana) decreases.
Work Step by Step
In economic terms, products are considered substitutes if they can be used in place of one another. In this case, beer and marijuana are substitutes for one another, as they are both recreational drugs that can be used for similar purposes (such as relaxation or socialization).
The logic behind the negative relationship between the price of beer and the demand for marijuana is that when the price of one product (in this case, beer) increases, consumers may be more likely to switch to the other product (in this case, marijuana) as a cheaper alternative. On the other hand, if the price of marijuana were to increase, consumers may be more likely to switch to beer as a cheaper alternative.
It is worth noting that the relationship between the price of beer and the demand for marijuana may be influenced by other factors such as personal preferences, cultural norms, and the legal status of the two products.
