An increase in the demand for HDTV sets leads to an increase in demand for LCD and LED TV screens. This situation arises because
A) LCD and LED screens minimize the costs of production.
B) the supply of LCD and LED screens has decreased.
C) the demand for LCD and LED screens is a derived demand.
D) of foreign production of LCD and LED screens.

Question

Quizplus · Accepted Answer

The demand for LCD and LED screens is a derived demand because it is derived from the demand for HDTV sets. Increased demand for HDTV sets leads to an increased demand for the technology used to produce them, i.e, LCD and LED screens. A and D are incorrect because there is no mention of production costs or foreign production affecting the situation, and B is incorrect because the question states that there is an increase in demand, not a decrease in supply.

An Increase in the Demand for HDTV Sets Leads to an Increase