Tennis Rackets and Tennis Balls: Complements in the Market

What happens when tennis rackets and tennis balls are complements in the market?

Since tennis rackets and tennis balls are complements, what will happen if there is a change in the price of tennis rackets?

Answer:

If tennis rackets and tennis balls are complements, an increase in the price of tennis rackets will cause the equilibrium price of tennis balls to decrease and the equilibrium quantity of tennis balls to decrease.

When tennis rackets and tennis balls are complements in the market, it means that the demand for one product is influenced by the price of the other. If the price of tennis rackets increases, it will lead to a decrease in the demand for tennis rackets. As a result, the equilibrium price of tennis balls will also decrease.

Equilibrium price is the price at which the quantity demanded by consumers matches the quantity supplied by producers in the market. In this case, with the decrease in demand for tennis balls due to the increase in tennis racket prices, the equilibrium price of tennis balls will also decrease.

This change in equilibrium price and quantity highlights the interdependence of complementary goods in the market. Consumers often purchase tennis rackets and tennis balls together, so a change in the price of one product can have a ripple effect on the other.

Therefore, understanding the concept of complements in economics helps to predict how changes in prices of related products can impact market equilibrium and consumer behavior.