Question

americans love to eat their hot dogs with mustard. What effect would a decrease in the price of hot dogs have on the market for mustard (if everything remains constant)?

a. price rises and quantity falls

b. price and quantity both rise

c. price and quantity both fall

d. no effect

e. price falls and quantity rises (INCORRECT)

explain answer please!

Answer 1

As we from the given statement which can be clearly seen that hot dogs and mustard are complements to each other

Complements are those good which complete each other

For example bread and butter, pen and paper

So when there is fall in the price of hot dogs it means there will be more quantity demanded of hot dogs and if the quantity demanded of hotdogs increases then quantity demanded of mustard will also increase

This will shift the demand curve to the right shown below

Answer is option B