Economics

Complementary Good

Complementary Good

Complementary Good actually means a good’s demand is increased when the price of another good is decreased. It is a good with a negative cross elasticity of demand, in contrast to a substitute good. If the price of one good falls and people buy more of it, they will usually buy more of the complementary good also whether or not its price also falls. Similarly, if the price of one good rises and reduces its demand, it may reduce the demand for the paired good as well. Also called complementary product.