If two goods are complements, this means that a rise in the price of one commodity will induce _________.

an upward shift in the demand for the other commodity

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a rise in the price of the other commodity

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a downward shift in the demand for the other commodity

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no shift in the demand for the other commodity

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Solution

The correct option is D a downward shift in the demand for the other commodity
There lies an inverse relationship between the price of one complementary good and the demand for another complementary good, since the complementary goods are required to be consumed together. Thus, with the rise in price of one commodity, which is a complementary good, the demand for the other decreases.

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