The horizontal axis is labeled quantity. The vertical axis is labeled price. Two downward sloping curves marked D 1 and D 2 are plotted. Curve D 1 lies below curve D 2 and these curves do not touch the axes at any point. Points x and y are marked on curve D 1. Point y lies down and to the right of point x. The lines don't touch the axes at any point.

Suppose that tacos and pizza are substitutes, and that soda and pizza are complements. We would expect an increase in the price of pizza to

Multiple Choice

• increase the demand for both soda and tacos.

• reduce the demand for soda and increase the demand for tacos.

• reduce the demand for both soda and tacos.

• reduce the demand for tacos and increase the demand for soda.

Transcribed Image Text:

Price 0 D₁ Quantity D₂ Price 0 D₁ Quantity D₂

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