Answer to Question #317402 in Microeconomics for Boo

Question

When both the price of a substitute and price of the complement of commodity-x rise, then what

would be the impact on demand for x-commodity explain your answer.

Answer 1

complimentary goods are those goods whose demand are linked and therefore if the price of complimentary to X increases its demand decrease and so does the demand for good X,on other hand substitute good and those goods which can be used for the same purpose by the consumer so that when the price of substitute to commodity X increases their demand decreases and thus the consumer will consume more of commodity X to recover the lost utility hence the demand the for X will increase.