Question

Danika is looking to purchase a new laptop for her university studies. She will need to use Microsoft Office on the laptop. However, retailers sell laptops and the Microsoft Office Software separately. JB Hi-Fi is having a sale, offering customers a 50% discount on the usual Microsoft Office price with any laptop they purchase.

Which of the following statements are true:

		The decrease in price of Microsoft Office offered by JB Hi-Fi will cause a decrease in the quantity demanded of the laptops they sell.
		The decrease in price of Microsoft Office offered by JB Hi-Fi will cause an increase in both demand and quantity demanded for laptops they sell.
		The decrease in the price of Microsoft Office offered by JB Hi-Fi will only result in an increase in the quantity demanded for laptops they sell.
		Economic theory is unable to predict if there would be any shift in demand with JB Hi-Fi’s 50% discount offer.

Answer 1

Option 2. The decrease in price of Microsoft Office offered by JB Hi-Fi will cause an increase in both demand and quantity demanded for laptops they sell.

Explanation: The laptop and the Microsoft office are complementary goods. In the case of complementary goods, the fall in the price of one goods results in the rise in the quantity demanded as well as the demand for the other good.