Peter's Pizzeria sells both pizzas and wings. It wants to increase the sales of its pizzas. If it decides to increase the price of the wings, it is assuming that a. the pizza and the wings are substitutes b. the pizza and the wings are unrelated in demands c. the pizza and the wings are complements d. it cannot increase the sales of its pizzas

Question

Cory

Business

19 November, 12:50

Peter's Pizzeria sells both pizzas and wings. It wants to increase the sales of its pizzas. If it decides to increase the price of the wings, it is assuming that a. the pizza and the wings are substitutes b. the pizza and the wings are unrelated in demands c. the pizza and the wings are complements d. it cannot increase the sales of its pizzas

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Answers (1)

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Alena Warren · Answer 1

The correct answer is: a) the pizza and the wings are substitutes.

Explanation:

Analyzing the scenario of the question above, in the case of Peter's pizzeria, which sells pizza and wings and wants to increase the sale of pizzas by adopting a strategy of increasing the price of wings, in this case, he is assuming that pizza and wings are substitutes.

Substitute goods are those that can be consumed in substitution for another good, even if they are in different categories, as long as they perform the same function, but in a different way.