If the price of personal computers were to rise, then the demand for printers would decrease because personal computers and printers are
A complementary goods.
B consumer goods.
C inferior goods.
D substitute goods.
The correct answer and explanation is:
The correct answer is A. Complementary goods.
Complementary goods are products that are typically used together, meaning that when the demand for one good rises, the demand for the other good also tends to rise, and vice versa. In this case, personal computers and printers are complementary goods. They are often used together for tasks like printing documents from a computer.
If the price of personal computers were to rise, this could make them less affordable for consumers. As a result, fewer people may be able to afford personal computers, which would lead to a decrease in the demand for them. Since printers are commonly used alongside personal computers, a decrease in the demand for computers would likely lead to a decrease in the demand for printers as well. This is because fewer people purchasing computers means fewer people need printers, thus reducing the overall demand for printers.
On the other hand, consumer goods are products that are purchased for personal use. While personal computers and printers are consumer goods, the specific relationship described in this scenario relates to the complementary nature of these goods rather than their classification as consumer goods.
Inferior goods are goods whose demand decreases as income rises. However, the price of personal computers affecting printer demand is not related to income levels or the classification of the goods as inferior.
Substitute goods are products that can replace each other. For example, if the price of personal computers increases, the demand for printers would not decrease because printers do not replace computers, but complement them. Therefore, they are not substitute goods.
Thus, the key relationship here is that personal computers and printers are complementary goods, and the rise in the price of personal computers would likely reduce the demand for printers.