Two Products Are Complements If

question 19

Multiple Choice

Two products are complements if:

• A) a decrease in the price of one causes buyers to demand less of the other.
• B) an increase in the price of one causes buyers to demand more of the other.
• C) a decrease in the price of one causes buyers to demand more of the other.
• D) individuals consume the goods together.

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Definitions:

Right Price

The optimal price point for a product or service that reflects its value to the customer while allowing a business to make a reasonable profit.

Price Elastic

Describes a situation where the demand for a product changes significantly in response to a change in the product's price.

Price Inelastic

A situation where the demand for a product does not change significantly in response to price changes.

Price Volatile

Characterizes a market or commodity whose price is subject to rapid, unexpected, and often large changes.