You observe that an increase in the price of salsa decreases the demand for tortilla chips and increases the demand for potato chips. You can conclude that

Question

Quizplus · Accepted Answer

This is because an increase in the price of salsa (a complement of tortilla chips) decreases the demand for tortilla chips, indicating they are complements. At the same time, it increases the demand for potato chips, indicating they are substitutes. This implies that salsa and tortilla chips are complements, while salsa and potato chips are substitutes.

You Observe That an Increase in the Price of Salsa