Our Bottom Line: Complementary Goods
When you see retailers selling sofas and throw pillows, do think about how they are increasing their sales by providing goods that go together.
Like cheese and chips, sofas and pillows need each other. When demand for one increases, its partner also becomes more popular. Thinking economically, we can use supply and demand graphs to show the boost in demand.
An increase in demand for cheese…
creates an Increase in demand for chips.
So, when you see retailers selling sofas and throw pillows, do think chips and cheese.