CONCEPT OF COMPLEMENTARY GOODS
Learning Contents: · Meaning of complementary goods. · Characteristics of complementary goods. · Types of complementary goods- strong and weak complements with examples. Complementary goods Complementary goods are those goods that are used together i.e. consumption of one commodity depends upon the consumption of the other. In simple words, goods which jointly create the demand. Examples of such goods are car and petrol, Phones and sim cards, needle and thread, bikes and bike helmets, etc. Characteristics of complementary goods 1. Complementary goods are consumed together: Complementary goods are the goods whose demand is tied to the demand of another good. Such goods have no value if consumed alone. For e.g. Car has no value when it has no fuel. 2. Positive utility when consumed together: A consumer enjoys positive utility when these goods are consumed together. They add va