A and B are substitute goods, but A and C are complementary goods. If the costs of producing A decreases, then the demand for:

Question

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When the cost of producing A decreases, the price of A is likely to decrease, increasing the demand for A. As A and B are substitutes, the demand for B will decrease. Since A and C are complements, the demand for C will increase as more of A is consumed.

A and B Are Substitute Goods, but a and C