Frank sells building materials used in new home construction to building supply stores. Increased real estate activity and new home construction in his territory has coincided with a noticeable increase in his sales to building supply stores. What does this demonstrate?
A) articulated demand
B) secondary demand
C) derived demand
D) primary demand

Question

Quizplus · Accepted Answer

The increased sales in building materials due to increased real estate activity and new home construction demonstrates derived demand, which refers to the demand for a product that is derived from the demand for another product or service. In this case, the demand for building materials is derived from the demand for new home construction.

Frank Sells Building Materials Used in New Home Construction to Building