Suppose the cross-price elasticity between good X and good Y is -1.6, and the price of good Y increases. We can conclude that:

A. demand for good X increases.

B. demand for good X decreases.

C. demand for good X remains unchanged.

D. demand for good X increases only if there is a recession in the economy.

E. None of the above.

The correct answer to the given question is option B. demand for good X decreases.

In the given question, since the cross price elasticity between good X and good Y is negative (i.e. -1.6), it can be inferred that the percentage change in price for good Y is inversely related to the percentage change in quantity demanded for good X. Hence, if there is an increase in the price of good Y, the demand for the good X will decrease such that ratio of the latter and the former is -1.6.