Chapter 48, Problem 1MCQ

To determine

The result if the cross-price elasticity of demand is negative between two goods.

Explanation of Solution

If the cross-price elasticity of demand is negative between two goods then in this situation, two goods are complements because both goods are used together and if price of one complement increases it will affect the demand of its another complement.

Therefore, the correct option is b.

Economics Concept Introduction

Introduction:

Complementary goods are the goods which are valuable to each other and customers use these goods in conjunction with another such as car and petrol.