A product that is used or consumed jointly with another product and is more valuable when paired with its complement is called a

• A. Substitute Good
• B. Complementary Good
• C. Supply
• D. Elasticity

Answer: (B)

Two goods that are used together and become more valuable when paired are called complementary goods. The idea is that the benefit of one item depends on having the other, so people often buy them together and the overall usefulness rises when both are available. This shows up in demand relationships: if the price of the complement falls, demand for the original good tends to rise, and if the price of the complement rises, demand for the original tends to fall. Classic examples include printers and ink cartridges or cars and gasoline.

Substitute goods, by contrast, satisfy similar needs and can replace each other; a drop in the price of one can reduce demand for the other. Supply refers to how much producers are willing to produce at various prices, and elasticity measures how responsive quantity demanded or supplied is to price changes.