Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
increase
B
decrease
C
remain unchanged
D
become elastic
Understanding the Answer
Let's break down why this is correct
Answer
When the price of muffins goes up, people may buy fewer muffins. Since muffins and coffee are complementary goods, meaning they are often enjoyed together, this can lead to a decrease in the demand for coffee as well. For example, if someone usually buys a muffin and a coffee for breakfast, a higher price for muffins might make them decide to skip the muffin and not buy the coffee either. This shows that when the price of one good increases, it can affect the demand for another good that is usually purchased alongside it. Therefore, as the demand for muffins decreases, the demand for coffee is likely to decrease too.
Detailed Explanation
When muffins cost more, people buy fewer muffins. Other options are incorrect because Some might think that if muffins are more expensive, people will buy more coffee to enjoy with them; It's a common mistake to think that demand stays the same regardless of price changes.
Key Concepts
Complementary Goods
Demand
Cross-Price Elasticity
Topic
Complementary Goods and Demand
Difficulty
medium level question
Cognitive Level
understand
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