Concept:Derived demand means the need for a good that arises only because of the demand for another good.
Explanation:Wood and labour are not demanded for their own sake.
They are demanded to produce other things, such as furniture, houses, or construction works.
When the demand for furniture or buildings rises, the demand for wood and labour also rises.
Thus, the demand for these inputs depends on the demand for the final products they help to make.
This is the meaning of derived demand.
It is different from effective demand, which is backed by the ability and willingness to pay.
It is also not competitive or complementary demand because those terms relate to how goods interact with one another.
Answer:The correct option is A. derived demand.