Bundle: Microeconomics, 13th + Aplia, 1 Term Printed Access Card
Bundle: Microeconomics, 13th + Aplia, 1 Term Printed Access Card
13th Edition
ISBN: 9781337742535
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 13, Problem 1QP
To determine

Meaning of derived demand for a factor.

Expert Solution & Answer
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Explanation of Solution

Derived demand is the demand for the factors of production that depend on the demand for the good that the factor produces. Since the demand for labor depends on the demand for goods and services that the labor produces, the demand for labor is a derived demand. For example, when the demand for product increases, the demand for labors also increases.

Economics Concept Introduction

Derived demand: Derived demand refers to the demand for the factors of production that depend on the demand for the good the factor produces.

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