Final answer:
An increase in the price of a substitute good is likely to cause a decrease in the demand for cheese. A decrease in the demand for cheese is likely caused by an increase in the price of a complementary good.
Step-by-step explanation:
A decrease in the demand for cheese is likely caused by an increase in the price of a substitute good. When the price of a substitute good increases, consumers tend to switch to the substitute instead of buying cheese, which decreases the demand for cheese. This is because the substitute good can fulfill the same purpose or need as cheese. For example, if the price of ham increases, people may choose to buy less cheese and more ham instead.
An increase in the price of a complementary good is likely to cause a decrease in the demand for cheese. This reflects the economic principle that when goods are consumed together, a price rise in one can reduce demand for the other. On the other hand, when the price of a substitute good increases, demand for cheese may increase as consumers look for alternative options.
A decrease in the demand for cheese is likely caused by an increase in the price of a complementary good. When we consider two goods that are used together, like cheese and crackers, if the price of crackers goes up, people are less likely to buy cheese because the overall cost of consuming both together is higher. This is different from a change in demand due to a price increase of the good itself, which would be a movement along the demand curve rather than a shift in the demand curve. Examples of factors that could cause a shift in the demand curve include changes in consumer preferences, income levels, price expectations, or the prices of related goods—either complements or substitutes.
In contrast, an increase in the price of a substitute good, such as almond cheese for dairy cheese, could lead to an increased demand for dairy cheese as consumers switch to it due to the now higher cost of the substitute. Understanding these relationships helps to predict consumer behavior and market dynamics.