Substitutes-
Substitutes are such products which have the capacity to satisfy the same needs, i.e., they can be used for the same purpose in place of each other e.g., Tea-coffee. In this case, when price of one goods increases, other things being equal, demand of substitutes also increases e.g., price of coffee increases, then demand of tea also increases.
Complementary Goods-
Those goods are used together for satisfying a particular want e.g, scooter-petrol. If price of scooter increases, then demand of its complementary goods is affected although price of petrol remains unchanged. In this way, inverse relation exists between price and quantity demanded of complementary goods.
