Question

Identify & explain the concept from the given illustration.

Manish purchased 100 metres of cotton textile to produce readymade shirts at his garment factory.

Answer 1

Concept: Indirect/Derived demand

Explanation:

1. Indirect demand refers to demand for goods which are needed for further production. It is the demand for producer's goods. 
2. Since cotton textile is purchased as a raw material to produce readymade shirts, this illustration is related to the concept of ‘indirect/ derived demand’.