1. Gold
Gold from two different mines.2. Wheat
Wheat from two different countries.3. Butter
Butter from two different producers.4. Labor
Completely unskilled labor such as a newspaper delivery person who has no power to demand a higher salary based on performance or skill.5. Electricity
Electricity is a service that was historically a perfect substitute. It is now possible that consumers might prefer electricity produced in a way that doesn't harm the environment.6. Materials
Basic materials such as cement from two different factories. Some firms have managed to make high-tech or low-environmental impact cement that demands a premium such as translucent concrete.7. Capital
Basic types of capital such as a wooden work bench.Perfect Substitutes vs Imperfect Substitutes
Perfect substitutes are identical in the eyes of the customer. Imperfect substitutes are situations where the customer sees a difference between products and/or producers that fulfill the same need. For example, two different brands of shampoo that are perceived differently by customers. It is also possible for imperfect substitutes to be in completely different product categories such as a bicycle that substitutes for a car.| Overview: Perfect Substitutes | ||
Type | ||
Definition | A good that customers view as all the same with no difference between the products and services of different producers. | |
Related Concepts | ||
