Give examples of two substitute goods and two complementary goods. In each case explain why the goods are substitutes or complements
Please provide the best answer for the statement.
The pair of substitute goods given should correspond to the explanation that they are substitutes because when the price of one changes, the demand for the other changes in the same direction. When the price of butter rises, one expects the demand for margarine to increase; when the price of butter falls, one expects the demand for margarine to fall as butter lovers switch back to butter consumption.
The pair of complementary goods should fit the explanation that they are complements because when the price of one changes, the demand for the other is inversely related. When the price of tennis equipment rises, the demand for tennis-club memberships should fall (if tennis playing is a normal good).
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