When the iPhone5 was introduced, the demand for iPhone5 protective cases increased. This information tells us that the iPhone5 and iPhone5 protective cases are
A)substitutes and their indifference curves are close to straight lines.
B)substitutes and their indifference curves are close to L-shaped.
C)complements and their indifference curves are close to L-shaped.
D)complements and their indifference curves have a constant marginal rate of substitution.
E)substitutes and their indifference curves have a constant marginal rate of substitution.

Question

Quizplus · Accepted Answer

The increase in demand for iPhone5 protective cases when the iPhone5 is introduced suggests that the two goods are complements. This is because an increase in the demand for one (iPhone5) leads to an increase in the demand for the other (protective cases), indicating that they are typically consumed together. Additionally, the fact that their indifference curves are L-shaped suggests that the consumer's desire for iPhone5 cases is not very high unless they also have an iPhone5.

When the IPhone5 Was Introduced, the Demand for IPhone5 Protective