Question

Why does demand for substitutes tend to move in the opposite direction from
each other?
O A. One of the substitutes is usually elastic, while the other is
inelastic.
O B. When the price of a good goes up, consumers shift their demand
to its substitute.
C. Substitute goods have perfect unit elasticity for each other.
O D. Substitute goods tend to have inelastic demand.

Answer 1

Answer:

O B. When the price of a good goes up, consumers shift their demand

to its substitute.

Explanation:

Substitute goods are products that can be used in place of one another. Consumers will be happy to consume either of the products. Substitute goods provide similar solutions to customers' problems.

Should the price of one substitute good increases, its demand is likely to fall. Consumers will prefer to consume the alternative product resulting in an increase in demand for the substitute.