Example: Give an example of “substitutes in production.” Explain how the products meet the economic definition of “substitutes in production.”
What will be an ideal response?
Answer:
Before giving example let us see what substitutes in production means,it implies goods which can be produced using similar raw materials or products,it is akin to saying more production of one of such goods will lead to decrease in production of other,now coming to example,let us consider a dairy shop which sells cheese,curd,milk made sweets and butter,all have milk as main ingredient,noe suppose a study comes which states that butter and sweets are harmful while curd and cheese are good for children and all of a sudden people demand more of curd and cheese and less of sweets and butter leading to milk now being used much more for curd and cheese than other 2 products,this example talks about curd and cheese in a way substituting sweets and butter.
Coming to how products meet the economic definition of substitutes in production ,we look at definition and example above and the main point in definition is these products are made of similar raw materials like in our case milk or resources used are similar in these products,so one product can substitute other by virtue of having similar production material in it.
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