Asked by Kionaa Genisee on May 28, 2024

verifed

Verified

Demand for Barbara Streisand CDs is equal to Qs  P1.70sI2.20P1.80c, where Qs is the number of CDs, Ps is the price of a Streisand CD, I is per capita income, and Pc is the price of a Karen Carpenter CD.Streisand and Carpenter CDs

A) are inferior goods.
B) are complements.
C) are substitutes.
D) have diminishing returns to scale.
E) are not as good as the original 8-track tapes.

Barbara Streisand CDs

Compact discs containing music recorded by Barbara Streisand, an American singer, actress, and filmmaker.

Karen Carpenter CD

A compact disc featuring the music of Karen Carpenter, an American singer known for her contributions to the duo The Carpenters.

Per Capita Income

The average income earned per person in a certain area, calculated by dividing the area's total income by its total population.

  • Understand the effect of complementary and substitute goods on market demand.
verifed

Verified Answer

SP
Stephany Peraza MolinaMay 28, 2024
Final Answer :
C
Explanation :
The equation shows that the demand for Streisand CDs depends on their own price, as well as the price of a substitute, which is the Karen Carpenter CD. This suggests that Streisand and Carpenter CDs are substitutes, as an increase in the price of one would lead to an increase in demand for the other.