If the demand for a good increases,the demand for the factors used to produce the good
A) increases.
B) decreases.
C) stays the same.
D) could increase, decrease, or stay the same depending on whether the demand for the good is elastic, inelastic, or unit elastic.
E) None of the above answers is correct.

Question

Quizplus · Accepted Answer

If the demand for a good increases, the demand for the factors used to produce the good also increases. This is because with an increase in demand, producers need to produce more of the good, and hence require more factors of production.

If the Demand for a Good Increases,the Demand for the Factors