What does it mean if XED equals 0?

If XED is 0, two goods are unrelated.

What does it mean if XED is negative?

If XED is negative, two goods are complementary. For example, if the price of coffee increases, the demand for coffee contracts, causing the demand for milk to decrease. If XED is less than -1, they are strong complements. If XED is between 0 and -1, they are weak complements.

Y12 Microeconomics Notes

XED | A-Level Economics Notes

Jaisul Naik

12 Feb 2026 • 1 min read

These revision notes cover everything you need to know about XED for A-Level Economics. They're designed for students studying AQA A-Level Economics, Edexcel A-Level Economics, and Edexcel International A-Level Economics. Written by Jaisul Naik, UCL Economics graduate and A-Level Economics tutor since 2017.

What is the formula for XED?

% change in demand of good A/ % change in price of good B.

What is the definition of XED?

XED is the responsiveness of demand for good A to a change in price of good B.

What does it mean if XED = 0?

If XED is 0, two goos are unrelated.

What does it mean if XED is positive?

If XED is positive, two goods are substitutes. This means that they are in competitive demand.

If the price of coffee increases, the demand for coffee contracts. This causes the demand for tea to increase.

If XED is more than 1 - they are strong substitutes.

If XED is between 0 to 1 - they are weak substitutes.