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What are indirect derived demand components of a transportation system?
Wiki User
∙ 13y ago
Considers movements created by the requirements of other movements. The most obvious example is energy where fuel consumption from transportation activities must be supplied by an energy production system requiring movements from zones of extraction, to refineries and storage facilities and, finally, to places of consumption. Warehousing can also be labeled as an indirect derived demand since it is a non movement of a freight element. Warehousing exists because it is virtually impossible to move commodities instantly from where they are produced to where they are consumed.
Wiki User
∙ 13y ago
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Why shipping is a derived demand?
Shipping is derived from the demand for transportation of goods, etc.
Different between direct demand and indirect demand?
Direct demand is the demand that the primary agent has for something. The primary agent desires the good or service for themselves. Indirect demand is the demand that arises for something by a secondary agent due to an interaction that occurs corresponding to the primary agent. For example: If a federal mandate occurs for ethanol to be blended at a level for the entire transportation fuel supply, the increase in corn demanded for producing ethanol is an indirect demand. The mandate may not be for corn use, but there is indirect demand for corn. However, consider that the ethanol production facilities that utilize corn for the production of ethanol have a direct demand for corn. The indirect demand for corn arises from the original demand for ethanol. The designation of direct or indirect is a matter of perspective for the question being asked.
What is meant by derived demand and how does this demand characteristic impact freight demand?
Derived demand is the demand to transport goods or services to location depend on demand to consume a goods or services to location. Freight of product is derived from the customer demand of product.
Where is business demand often derived?
The nature of the demand for products differs from consumer demand because it is often derived from consumer demand.
What is an example for derived demand?
Derived demand comes from demand for another product. For example, if coal is in high demand, then there will be derived demand for mining. Another example: A farmer grows crops. In order to grow crops he needs fertilizer. Therefore, the amount of fertilizer he needs to buy, will derive from the amount of crops he needs to grow. Basically, derived demand comes as a result of demand for something else.
Why is the demand of transportation a derived demand?
The demand for transportation is said to be "derived" because the large majority of travel is not for the purposes of movement, but in order to reach destinations. When demand for a good is direct (the opposite of derived) the core presumption is insatiability: all else being equal, more is preferred to less. More computing power is preferred to less computing power, as an example. A necessary intermediate good to computing power is electricity. All else being equal (e.g., in the operation of two computers of equal computing power) we do not prefer more electricity over less. The same is true of transportation. To see this, imagine two routes from point "a" to point "b." They are identical except for their length. If the demand for transportatoin were direct, the longer route would be preferred over the shorter one--since it would represent consuming "more" transportation. But for virtually all trips, the shorter route is preferred, because the transportation isn't valued in and of itself, but as a means to reach destination "b."
Why is industrial demand called derived demand?
because the demand comes from end user
Why is the demand of labor a derived demand?
labor demand is said to be derived demand because it is derived from the output levels in the goods market, which contribute to employers revenue and hence profit. one important thing is that, it is a means to an end. that is something employers look out for to enhance production.
What are the types of demand?
interrelated demand joint/complement demand competitive derived composite independent
Demand for one good or service that is determined by demand for another good or service is .?
derived demand
Demand for one good or service that is determined by demand for another good or service is?
derived demand
What is an example for demand?
Derived demand comes from demand for another product. For example, if coal is in high demand, then there will be derived demand for mining. Another example: A farmer grows crops. In order to grow crops he needs fertilizer. Therefore, the amount of fertilizer he needs to buy, will derive from the amount of crops he needs to grow. Basically, derived demand comes as a result of demand for something else.
