Answer to Question #302897 in Microeconomics for Yashu

Question

The price of good A falls. This causes an increase in the price of good B. Goods A and B are therefore complements.

Answer 1

The fall in price of good A leads to an increase in it's demand and since good A and B are complements, an increase in the demand for good A will also translate into an increase in the demand for good B. This will make the producers of good B to take advantage of the increase in demand and increase their prices so that they can get maximum revenue.