A rise in mortgage rates has resulted in a lower demand for new housing. Consequently, there is a lower demand for building materials such as lumber, steel, and window glass. This effect is called

Question

Quizplus · Accepted Answer

Derived demand occurs when the demand for one good or service occurs as a result of the demand for another related good or service. In this case, the demand for building materials is derived from the demand for new housing.

A Rise in Mortgage Rates Has Resulted in a Lower