What is the difference between a derived demand curve and a direct demand curve?
A)Derived demand is unknown, whereas direct demand is known.
B)Derived demand is unobservable, whereas direct demand is observable.
C)Derived demand is demand determined by the demand for another good, whereas direct demand is demand for a good itself.
D)Derived and direct demand are both terms referring to the same thing.

Question

Quizplus · Accepted Answer

Derived demand refers to the demand for a good that is based on the demand for another good, such as the demand for rubber that is derived from the demand for tires. Direct demand, on the other hand, is the demand for a good itself, such as the demand for a particular brand of tire. Therefore, the main difference between the two is that derived demand is determined by the demand for another good, while direct demand is determined by the demand for the good itself. Derived demand refers to the demand for a good that is determined by the demand for another good, such as the demand for steel being derived from the demand for automobiles. Direct demand, on the other hand, is the demand for a good itself, such as the demand for automobiles. Therefore, the main difference between the two is the relationship between the demand for the goods.

What Is the Difference Between a Derived Demand Curve and a Direct