If a 5 per cent increase in the price of good A leads to a 4 per cent decrease in the demand for good B, then
A) both goods are normal goods.
B) the goods are substitutes.
C) the goods are complements.
D) only one good is a normal good.

Question

Quizplus · Accepted Answer

The goods are complements because an increase in the price of good A leads to a decrease in the demand for good B, indicating that they are used together.

If a 5 Per Cent Increase in the Price of Good