Principles of Economics (Second Edition)
2nd Edition
ISBN: 9780393614077
Author: coppock, Lee; Mateer, Dirk
Publisher: W. W. Norton & Company
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Question
Chapter 14, Problem 1QFR
To determine
To explain:
The reasons
Expert Solution & Answer
Explanation of Solution
Demand for factors is the demand for factor inputs at different factor prices.Demand for a good is the quantity demanded of a good at different prices of that good.
A higher demand for a good implies that the production of that good increases. As a result, the demand for factor inputs required for production of that good increases. This means that demand for factor inputs is derived from the demand of the goods in production of which those factors are employed. Hence, factor demand is derived demand.
Economics Concept Introduction
Demand for factors:It is the demand for factor inputs at different factor prices.
Demand for good:It is the quantity demanded of a good at different prices of that good.
Derived demand:When the demand for a good or service arises as the outcome of the demand for another good or service, it is referred as derived demand.
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Chapter 14 Solutions
Principles of Economics (Second Edition)
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