PRC-3 · Chapter 7 · Question 55 of 72
A factory manufactures specialized microchips. They notice that the demand for their microchips only rises when consumer demand for the latest smartphones rises. What economic term describes the demand for these microchips?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Derived demand
Explanation
Industrial products typically have derived demand, meaning the demand for them is derived entirely from the demand for the final consumer goods they are used to build.
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