📚 Learning Guide
Inferior and Complementary Goods
easy

If the price of Jiffy mix decreases, what is the likely effect on the demand for collard greens, assuming they are complementary goods?

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Choose the Best Answer

A

The demand for collard greens will increase because lower prices encourage consumption of both items.

B

The demand for collard greens will decrease because people will buy less Jiffy mix.

C

The demand for collard greens will stay the same regardless of Jiffy mix prices.

D

The demand for collard greens will increase only if incomes rise.

Understanding the Answer

Let's break down why this is correct

Answer

When the price of Jiffy mix decreases, it can lead to an increase in the demand for collard greens because they are complementary goods. Complementary goods are products that are often used together, so when one becomes cheaper, people are more likely to buy both. For example, if someone enjoys making cornbread with Jiffy mix, they might also buy collard greens to serve with it. As more people buy Jiffy mix due to its lower price, they will also purchase more collard greens, causing their demand to go up. This shows how the relationship between the prices of complementary goods can affect consumer choices.

Detailed Explanation

When Jiffy mix costs less, more people will buy it. Other options are incorrect because This answer thinks that if people buy less Jiffy mix, they will also buy less collard greens; This choice suggests that the price of Jiffy mix doesn't affect collard greens at all.

Key Concepts

Inferior Goods
Complementary Goods
Consumer Behavior
Topic

Inferior and Complementary Goods

Difficulty

easy level question

Cognitive Level

understand

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