WAEC Economics 2011 Theory — Question 14

Model answer

Competitive demand is the type of demand that exists when two commodities are substitutes to each other. The demand for one will reduce or cancel the demand for the other, e.g. demand for Milo and Bournvita. Complementary demand is one in which the demand for one commodity necessitates the demand for the other commodity. In other words, the two commodities are complements, e.g. car and petrol, exercise book and biro.