Economics Part B

Table of Contents

Substitute products

Substitute products (we refer to products 1 and 2)

These are products which substitute each other.

Products 1 and 2 are substitute products, if the growth in demand for one of them results in a decrease in demand for the other, and vice-versa – if a decrease in demand for one product results in an increase in demand for the other.

In general: the demand for them at any time is in opposite directions.

Examples of complementary products: Coca-Cola and Pepsi-Cola, Pelephone mobile phones and Cellcom mobile phones.