Question

If the price of a good (petrol) increases, the demand for its complementary good (cars) will ______.

Options

• decrease

• increase

• unaffected

• none of these

Answer 1

If the price of a good (petrol) increases, the demand for its complementary good (cars) will decrease.

Explanation:

• Petrol and cars are complementary goods, meaning they are used together.
• If the price of petrol increases, driving becomes more expensive.
• Hence, demand for cars may decrease, as people try to avoid the additional cost.