If two goods are substitutes, then
A) an increase in the price of one causes the demand for the other to fall.
B) there is an inverse relationship between changes in the price of one good and changes in the demand for the other.
C) if the price of one good falls, the demand for the other good falls also.
D) changes in the quantity demanded of one good will not affect the demand for the other.

Question

Quizplus · Accepted Answer

Substitute goods are those that can be used in place of each other. When the price of one substitute good falls, consumers are more likely to purchase it over its substitute, leading to a decrease in demand for the other good.

If Two Goods Are Substitutes, Then