Printers and ink cartridges are used together. If the price of printers falls sharply, what is likely to happen to the demand for ink cartridges, other things remaining the same?
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → It is likely to rise, as the two goods are complements
Printers and cartridges are used together, so they are complements. Cheaper printers mean more printers are bought, and each needs ink, so the demand for cartridges rises.
The demand for a good moves opposite to the price of its complement: printer price down, cartridge demand up.
NCERT (2026-27): “2.4.4 Substitutes and Complements … Goods which are consumed together are called complementary goods. Examples of goods which are complement to each other include tea and sugar, shoes and socks, pen and ink, etc. Since tea and sugar are used together, an increase in the price of sugar is likely to decrease the demand for tea and a decrease in the price of sugar is likely to increase the demand for tea. Similar is the case with other complements. In general, the demand for a good moves in the opposite direction of the price of its complementary goods. …” |