Question

Assume that popcorn and movie attendance are complements and that Salty Concession grows corn suitable for popping. Mr. Concession will most likely sell a greater quantity of popping corn at a higher price if which of the following occurs?
a) The wages of farm workers and movie theater employees increase.
b) A technological improvement results in less expensive and more efficient harvesting of corn.
c) The introduction of new fat-free potato chips provides new competition in the snack-food market.
d) The release of three summer movies sets records for movie attendance.
e) New government regulations force movie theaters to hire more security guards at each theater.

Answer 1

Answer:

d) The release of three summer movies sets records for movie attendance. 

Explanation:

Complementary goods are goods that are demanded for together. If the demand for one good increases, the demand for the other good increases.

The release of three summer movies would increase movie attendance. Also, demand for popcorn would increase. Demand would outstrip supply and quantity produced would rise and so would price.

The introduction of new fat-free potato chips which provides new competition in the snack-food market would reduce the demand for popcorn.

Technological improvement which results in less expensive and more efficient harvesting of corn would increase the supply of corn. Supply would outstrip demand and prices would fall.

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