Question

1. Identify the product of your choice Identify TWO resources required to build the product you have identified. Explain why the resources you identified have Demand which is derived from the product they are used to produce. For EACH of the two resources, specifically identify and discuss TWO determinants of demand PARTICULAR to those resources which, if those determinants were to change, would affect the location/shape of those resource demand curves.

Answer 1

Here as per the question,any product of choice can be selected depending upon the answerer's choice however i have chosen cotton textile for the choice of product.Textile pertains to the garment sector or clothing line of business which involves making,manufacturing a wide variety of clothes used for wearing of different sizes,colour,design etc.Cotton textile specifically relates to making of clothes using cotton.

The two resources required to manufacture the product i have chosen are Labour and Raw materials.Here the Labour means the skilled and unskilled labour force required at different stages of production of the cloth.Raw materials refer to the raw cotton that is used make thread first by spinning and then they are converted into yarn and then further given the form of clothes using weaving,stitching etc. of attractive qualities.Raw materials may also include other things used like dyes,threads etc.Here the both above mentioned resource would have a considerable demand in the market be it labour or raw material.This is so because the demand for them are derived demand.It means that they are demanded because they help in the production of such goods which are further demanded by the consumers.Here the cotton textiles are in great demand and cotton is the base material used for their production.Labourers take part at different stages and help in manufacturing.

The determinants of demand of any goods or services mainly depend upon two factors i.e.the cost/price of its own and other factors like consumer preferences,income of consumer,prices of substitutes and complments etc.Ceteris Paribus,There is an inverse relationship between the price of any product and its quantity demanded.If there is any change in the price of the commodity itself,this would lead to movements along the demand curve as this leads to change in the quantity demanded.And if there is any change related to factors other than its own price of the commodity,this would result in the shift in the demand curve.This may be inward or outward.

here the demand of raw cotton and labour depends upon the demand of the cotton textiles they help to make,by the consumers.Besides it also depends upon the prices of their own and their utility.