Question

Transportation's demand is dependent upon the demand for goods in other geographic locations. This concept is called

a) Inelastic demand
b) Derived demand
c) Elastic demand
d) Consumer demand

Answer 1

Derived demand is the concept that refers to the demand for one product or service being dependent on the demand for another related product or service.

Step-by-step explanation:

Derived demand is the concept that refers to the demand for one product or service being dependent on the demand for another related product or service. In the case of transportation, its demand is derived from the demand for goods in other geographic locations. This means that if there is an increase in the demand for goods in certain places, the demand for transportation to deliver those goods will also increase. An example of derived demand other than the demand for labor could be the demand for trucking services based on the demand for raw materials in manufacturing industries.