Which of the Following Best Illustrates the Concept of Derived

question 82

Multiple Choice

Which of the following best illustrates the concept of derived demand as explained in the text?

• A)The number of retail stores in a downtown area decreases and demand for retail goods increases.
• B)An increase in the number of new single family homes results from a spurt in the gross national product.
• C)The heat wave results in an increased demand for air conditioners.
• D)Jet engine manufacturers experience increased sales because more tourists are taking international vacations.

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Definitions:

Outward Shift

Refers to an expansion in an economy's production possibility frontier, indicating an increase in the ability to produce goods and services.

Production Possibilities Curve

A graphical representation showing the maximum combination of goods or services that can be produced with a fixed amount of resources and technology in a given period.

7 Percent Unemployment

A situation where 7 out of every 100 labor force participants are without a job and actively seeking employment, indicating the level of joblessness in an economy.

U.s. Economy

The United States' economic structure is defined by a mixed-market system, incorporating both private sector businesses and government involvement.