Which of the following statements best illustrates the concept of derived demand?
A. As income goes up, the demand for farm products will increase by a smaller relative
amount.
B. A decline in the price of margarine will reduce the demand for butter.
C. A decline in the demand for shoes will cause the demand for leather to decline.
D. When the price of gasoline goes up, the demand for motor oil will decline.
Answer: C
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A Big Mac costs $4.00 in the United States and 9.00 reals in Brazil. If the exchange rate is 2 reals per dollar, what is the dollar cost of a Big Mac in Brazil?
A) $0.89 B) $2.25 C) $4.50 D) $8.00
The circular flow diagram is
a. an accurate description of reality b. an economic model c. not expected to explain reality d. a road map explaining all money flows in the economy e. a road map explaining all product flows in the economy
Someone who does not have a job but is not counted as unemployed, such as a retiree, is:
A. not in the civilian labor force. B. considered employed. C. still, nonetheless, part of the civilian labor force. D. not counted in the civilian adult population.
For a monopoly, the marginal revenue curve ________ its demand curve.
A. is the same as B. is above C. has no relation to D. is below