Question

For each of the pairs below, explain briefly whether they can be considered as substitutes or complements. a. physician services and prescription drugs
b. optometrists and ophthalmologist services
c. office manager and physician

d. branded and generic drugs

Answer 1

a) physician services and prescription drugs are complementary goods because the prescription drugs will be prescribed by a physician only.

b)optometrists and ophthalmologist services are subsitute to each other because both of them havethe same occupation of dealinng with diseases of eye.

c) office manager and physician can not be described either as subsitute goods or complement goods as they are unrelated goods.

d) branded and generic drugs are substitute goods because they can be subsituted at each other place. A consumer has a choice either to use branded drugs or generic drugs.