Finance Formulas / July 18, 2018 / Cecelia Weiss
Cross Price Elasticity of Demand (XED) is the responsiveness of demand for one good to the change in the price of another good. It is the ratio of the percentage change in quantity demanded of good x to the change in the price of Good Y. In business, Cross Elasticity of Demand is important because it will help determine whether or not it is a good move to increase or decrease prices or to substitute one product for another for revenue.
EBITDA is a non-GAAP financial figure that measures a company's profitability before deductions that are considered somewhat superfluous to the business decision-making process. These deductions are interest, taxes, depreciation and amortization, all of which are not part of a company's operating costs and are therefore not associated with the maintenance and administration of a business on a day-to-day basis.
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