What is the relation between good X and Y in each case , if with the fall in price of X demand for good Y 1)rises 2)falls give reason.
Dear student,
1) If with fall in price of X demand for good Y rises than X and Y are complementary goods.
Complementary goods are those which are consumed together.
For example: pen and ink; car and petrol, etc.
2) If with fall in price of X demand for good Y also falls then both X and Y are substitute goods.
Substitute goods are those which can be consumed in place of one another.
For example: tea and coffee.
Regards
1) If with fall in price of X demand for good Y rises than X and Y are complementary goods.
Complementary goods are those which are consumed together.
For example: pen and ink; car and petrol, etc.
2) If with fall in price of X demand for good Y also falls then both X and Y are substitute goods.
Substitute goods are those which can be consumed in place of one another.
For example: tea and coffee.
Regards