Answer to Question #15448 in Microeconomics for anne gulati

Question

when the price of cars rises, what will be the effect on the equilibrium price and quantity of a)tires
b)bus tickets

Answer 1

a) when the price of cars rises, there is a reduction of car's demand, demand for the accompanying goods (tires) decreases too, so price and
quantity of tires decreases.
b) when the price of cars rises, the is a reduction of car's demand, more people buy bus tickets because they
can't buy the car. So price and quantity of bus tickets grow up.