Question

If X and Y are complementary goods, a rise in the price of Y will cause the demand curve of X to ______.

Options

• Shift to the left

• Shift to the right

• Extend

• Contract

Answer 1

If X and Y are complementary goods, a rise in the price of Y will cause the demand curve of X to Shift to the left.

Explanation:

If X and Y are complementary goods, a rise in the price of Y will decrease the demand for Y, and consequently, the demand for X will also decrease because the two goods are used together. This decrease in demand for X will cause the demand curve of X to shift to the left.