which of the following is an example of derived demand

Step 1: Analyze the question The question asks which item is an example of derived demand.

Step 2: Explain the concept Derived demand is demand for a good or factor that arises from the demand for another good or service. It is not wanted for its own sake. It is wanted because of what it helps to produce. Factors of production (labour, land, capital, raw materials) are the classic examples.

For example:

• Demand for bricklayers (labour) depends on the demand for buildings.
• Demand for cocoa beans depends on the demand for chocolate.
• Demand for flour depends on the demand for bread.

Step 3: Check each option

• A. Textbook: Students buy it directly for their own use, so it is a consumer good with direct demand. (Some might argue it is derived from the demand for education, but it is mainly a final consumer good.)
• B. Labour: Employers want workers not for themselves but to produce goods and services that consumers want. The demand for labour therefore depends on the demand for the output labour produces. This is derived demand.
• C. Staple food: Consumed directly to satisfy hunger, so it is direct demand.
• D. Mobile phone: A final consumer good wanted directly, so it is direct demand.

Step 4: Answer The best example of derived demand is labour, which is option B.

Exam tip: When you see "derived demand," think of factors of production (labour, land, capital, raw materials). If the item is used to make something else, its demand is derived. If people consume it directly, it is direct demand.