Asked by Mercy’s World on Jun 25, 2024

verifed

Verified

If the price of chocolate-covered peanuts increases and the demand for strawberry-flavored soft drinks decreases,this indicates that these two goods are _____ goods.

A) unrelated
B) complementary
C) inferior
D) substitute

Complementary Goods

Complementary Goods are products or services that are typically consumed together, where the demand for one increases the demand for the other.

Chocolate-Covered Peanuts

A snack made by coating peanuts in chocolate, combining the flavors and textures of both ingredients.

Strawberry-Flavored

It indicates a product or item that is designed to taste like strawberries, often achieved through natural or artificial flavoring agents.

  • Understand the concept of cross-price elasticity of demand.
  • Learn the impact of price changes on the demand for related goods (complements and substitutes).
verifed

Verified Answer

LS
Logan SmithJun 28, 2024
Final Answer :
B
Explanation :
When the price of one good increases and the demand for another good decreases, it indicates that the two goods are complementary, meaning they are often used together. In this case, if chocolate-covered peanuts become more expensive and as a result, fewer people want strawberry-flavored soft drinks, it suggests that these items are consumed together by consumers.