One determinant of the derived demand for a resource is the
A)price of the product made using the resource
B)extra cost of the resource
C)marginal resource cost of the resource
D)availability of the resource in the marketplace
E)quantity of the resource demanded

Question

Quizplus · Accepted Answer

The price of the product made using the resource is a major factor in determining the derived demand for the resource, as firms will only demand a certain amount of a resource if the price of the final product justifies its use. As the price of the final product increases, the derived demand for the resource will usually increase as well.

One Determinant of the Derived Demand for a Resource Is