Composite Demand Flashcards

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What is composite demand?

When one good is demanded for two or more different uses.

Crude oil is used for petrol and for making plastics.

Because the same limited good must be shared, so more for one use means less for others.

The price rises for all uses because total demand is higher.

It shifts to the right, because total demand increases.

Using that milk for drinking or for other dairy goods.

Composite demand is one good with many uses. Joint demand is two goods used together, like printers and ink.

Composite demand is one good wanted for many uses. Derived demand is demand for something because another good is wanted, like workers to make cars.

Total demand rises, so the price may rise and less is left for other uses.

Total demand falls, the demand curve shifts left, and the price may fall.