-In the above figure, if the price of good A falls from P₀ to P₁ and the demand for good B increases from D₀ to D₁, then goods A and B A) are substitute goods. B) are inferior goods. C) will have a negative cross elasticity of demand. D) are both price elastic but not perfectly price elastic.

Question

Quizplus · Accepted Answer

When the price of good A falls and the demand for good B increases, it indicates that goods A and B are complements, leading to a negative cross elasticity of demand.

-In the Above Figure, If the Price of Good a Falls