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Question

Difficulty: EasyTypes of Demand

Match each economic commodity or scenario on the left with its corresponding classification of demand on the right.

  • Petrol and motor vehiclesJoint (Complementary) demand
  • Tea and coffeeCompetitive demand
  • Farm labour for agricultural productionDerived demand
  • Electricity used for lighting, cooking, and powering machineryComposite demand

Answer

Petrol and motor vehicles match with Joint (Complementary) demand; Tea and coffee match with Competitive demand; Farm labour for agricultural production matches with Derived demand; Electricity used for lighting, cooking, and powering machinery matches with Composite demand.
Each commodity pair or scenario aligns with its defined classification of demand: petrol and cars are used together (joint demand), tea and coffee are substitutes (competitive demand), farm labour is needed for output production (derived demand), and electricity serves multiple functions (composite demand).

Step-by-Step Solution

1
Analyze 'Petrol and motor vehicles'
Since petrol and cars must be used together to provide transportation, they exhibit joint (complementary) demand.
Joint demand occurs when two or more goods are required together to satisfy a specific need.
2
Analyze 'Tea and coffee'
Tea and coffee serve as alternative goods satisfying similar beverage preferences, so they exhibit competitive demand.
Competitive demand occurs between substitute commodities where an increase in demand for one reduces demand for the other.
3
Analyze 'Farm labour for agricultural production'
Labour is demanded to produce crops rather than for direct consumption, representing derived demand.
Derived demand exists when the demand for a factor of production depends on the demand for the final output it helps produce.
4
Analyze 'Electricity used for lighting, cooking, and powering machinery'
Because electricity can be put to multiple different uses, it represents composite demand.
Composite demand refers to total demand for a product or resource that has multiple applications or uses.

Key Concept

Types of Demand (Joint, Competitive, Derived, and Composite)
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Topics

Types of Demand

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