You work for a marketing firm that has just landed a contract with Run-of-the-Mills to help them promote three of their products: tappies, frizzles, and cannies. All of these products have been on the market for some time, but, to entice better sales, Run-of-the-Mills wants to try a new advertisement that will market two of the products that consumers will likely consume together. As a former economics student, you know that complements are typically consumed together while substitutes can take the place of other goods.
Run-of-the-Mills provides your marketing firm with the following data: When the price of tappies decreases by 1%, the quantity of frizzles sold decreases by 18% and the quantity of cannies sold increases by 3%. Your job is to use the cross-price elasticity between tappies and the other goods to determine which goods your marketing firm should advertise together.