Compare the following two pairs of goods:

• Coke and Pepsi

• Skis and ski bindings

a. In which case are the two goods complements? In which case are they substitutes?

b. In which case do you expect the indifference curves to be fairly straight? In which case do you expect the indifference curves to be very bowed?

c. In which case will the consumer respond more to a change in the relative price of the two goods?