Complements and Derived Demand Shift

Steps:

• Complements are goods used together, so an increase in Y's supply lowers Y's equilibrium price.
• Lower price of Y boosts demand for X, shifting X's demand curve rightward.
• With upward-sloping supply for X, rightward demand shift raises X's equilibrium quantity.
• The same shift also raises X's equilibrium price due to higher demand pressure.

Why D is correct:

• For complements, a fall in Y's price increases X's demand (law of demand for complements), raising both P and Q of X.

Why the others are wrong:

• A: Quantity rises, not falls, from demand increase.
• B: Quantity rises, not falls.
• C: Price rises, not falls, from demand pressure.

Final answer: D