Shampoo and conditioner are complementary goods.
What happens to the price and quantity of conditioner if the price of shampoo decreases?

Choose 1 answer:
(A) Price decreases; quantity increases.
(B) Price decreases; quantity demanded does not change.
(c) Price increases; quantity decreases.
(D) Price increases; quantity increases.
(E) Price decreases; quantity decreases.

Question

Shampoo and conditioner are complementary goods.
What happens to the price and quantity of conditioner if the price of shampoo decreases?

Choose 1 answer:
(A) Price decreases; quantity increases.
(B) Price decreases; quantity demanded does not change.
(c) Price increases; quantity decreases.
(D) Price increases; quantity increases.
(E) Price decreases; quantity decreases.

Accepted Answer

***A*** ∻Key Concept∻ ⚹Complementarity in Demand⚹ ∻Explanation∻ ⚹When the price of a good decreases, the demand for its complementary good increases, leading to a higher quantity demanded. The price of the complementary good may decrease if the supply remains unchanged due to increased competition among sellers to capture the increased demand.⚹◊How would a decrease in the price of shampoo affect the demand for conditioner in the market?⍭ Generate me a similar question◊

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