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Derived Demand - Explained

What is Derived Demand?

Written by Jason Gordon

Updated at March 26th, 2023

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What is Derived Demand?

In economics, derived demand means the extent to which a consumer’s desire for a given product or service at a given price is derived from (exists as a result of) another good or service. 

This often arises when the utility of one good is tied to the use of another good, such as gasoline and motor vehicles. 

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explained derived demand

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