If two goods are substitute goods,
A)an increase in the price of one will cause a decrease in the demand for the other.
B)an increase in the price of one will cause an increase in the demand for the other.
C)the price elasticity of demand for both goods will be greater than 1.
D)the price elasticity of demand for both goods will be less than 1.

Question

Quizplus · Accepted Answer

When two goods are substitutes, an increase in the price of one good will lead to an increase in the demand for the other good, as consumers switch to the more affordable alternative.

If Two Goods Are Substitute Goods