Suppose A and B are complementary goods. Other things being equal, the demand curve for A will shift to the right when the price of B goes down.

Question

Quizplus · Accepted Answer

Complementary goods are goods that are consumed together, such as coffee and cream. When the price of one complementary good, in this case B, goes down, the demand for the other complementary good, A, will increase. This is because the lower price of B makes it more affordable for consumers to purchase both goods together, resulting in a shift of the demand curve for A to the right.

Suppose a and B Are Complementary Goods