Yam and palm oil are used together; therefore
Yam and palm oil are used together; therefore
- A) Yam is a substitute good while palm oil is a complimentary good
- B) Yam is complimentary good while palm oil is a substitute good
- C) Yam and palm oil are complimentary goods
- D) Yam and beans are substitute goods
Correct Answer: C) Yam and palm oil are complimentary goods
Explanation
This question is asking about the relationship between yam and palm oil. The question is asking whether yam and palm oil are substitute goods or complimentary goods. Substitute goods are goods that can be used to replace each other, while complimentary goods are goods that are used together.
In this case, yam and palm oil are used together, so they are complimentary goods. This means that when someone buys yam, they are likely to buy palm oil as well, and vice versa.
It's important to note that just because two goods are used together doesn't mean they are always complimentary goods. It depends on the specific situation and the preferences of the buyers.
For example, if someone is allergic to palm oil, then yam and palm oil would not be complimentary goods for them. They would use a substitute good instead, like a different type of oil.
It's also worth noting that the other options in the question are not correct. Yam is not a substitute good for palm oil, and palm oil is not a substitute good for yam. Yam and beans are not related in this question.
Understanding the difference between substitute goods and complimentary goods is an important concept in economics. It helps us understand how buyers make decisions about what to buy and how much to buy.