Explain what is meant by "derived demand" as it relates to factors of production
The demand for a factor of production is derived from the underlying demand for the final good or service that the factor produces. A firm does not wish to employ, and pay for, the factor for itself-the firm wishes to employ the factor for what the factor will add to the profitability of the firm. Therefore, an increase in the price of the final good or service, which will increase the profitability of production, will also lead to an increase in demand for the factor.
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In 2009, which category accounted for the highest share in the U.S. imports?
a. Industrial supplies b. Capital goods c. Services d. Consumer goods
What does research thus far suggest about job loss and offshoring?
What will be an ideal response?
An industry whose total output can be increased without a change in long-run per-unit costs is a(n)
A) increasing-cost industry. B) constant-cost industry. C) zero-cost industry. D) decreasing-cost industry.
Claudia went to a department store to buy a few things for her new house. She found out that several items in the store were on discount and decided to make the most of the deals offered
However, as she started using the things that she bought, she realized that many of these items were defective. This happened due to: A) the presence of positive externalities. B) the presence of negative externalities. C) asymmetric information. D) moral hazard.