A 20% increase in the price of rubber ducks leads to a 10% decrease in the quantity demanded of soap.Therefore:
A) The two goods are unrelated
B) The two goods are substitutes
C) The two goods are complements
D) The demand for rubber ducks is price elastic
E) The supply of soap is inelastic

Question

Quizplus · Accepted Answer

A 20% increase in the price of rubber ducks leads to a 10% decrease in the quantity demanded of soap, which indicates that rubber ducks and soap are complements. This is because an increase in the price of rubber ducks makes it more expensive to purchase, which in turn reduces the demand for soap, as consumers are less likely to use it without their preferred complement.

A 20% Increase in the Price of Rubber Ducks Leads