Derived demand for airline passenger travel is a major constraint on sales of new passenger aircraft by Boeing and Airbus.

Question

Quizplus · Accepted Answer

Derived demand refers to the demand for a product or service that results from the demand for another product or service. In this case, the demand for new passenger aircraft by manufacturers like Boeing and Airbus is directly influenced by the demand for airline passenger travel. If fewer people are traveling by air, airlines are less likely to purchase new aircraft, making the demand for airline passenger travel a major constraint on sales of new passenger aircraft.

Derived Demand for Airline Passenger Travel Is a Major Constraint