“Prices of related goods affect the household demand, and we can dif

1.	“Prices of related goods affect the household demand, and we can differentiate the related goods into two types.”(a) Which are the types of related goods that determine the demand? (b) Define them.
Answer» (a)(i) Substitutes (ii) Complementaries (b) Substitutes are those goods where one good can be used instead of other. Eg. Tea and Coffee. Complementary goods are those goods which are used together. Eg. Car and Petrol.

“Prices of related goods affect the household demand, and we can differentiate the related goods into two types.”(a) Which are the types of related goods that determine the demand? (b) Define them.

Answer»

(a)(i) Substitutes

(ii) Complementaries

(b) Substitutes are those goods where one good can be used instead of other.

Eg. Tea and Coffee.

Complementary goods are those goods which are used together.

Eg. Car and Petrol.