Question

1.Increase in demand for sma1.Increase in demand for microprocessors leads to a(n) ____ in the demand for processor assemblers.ll homes (compared to large homes) leads to a(n) _____ in demand for lumber.

Answer 1

Answer:

Increase in demand for microprocessors leads to a(n) increase in the demand for processor assemblers.

More the demand of housing, more the demand for lumber & vice versa.

Explanation:

Micro Processors & processor assemblers are complementary goods, they are jointly used to satisfy a particular want.

Complementary goods demand are directly related to each other. More demand of one good, more demand of other good  & less demand of one good, less demand of other good.

So, Increase in demand of micro processors would increase the demand of processor assemblers. Also, decrease in demand of micro processors would decrease demand of micro processor assemblers

Lumber is a particular kind of wood required in house construction. Demand of lumber is a derived demand, arising indirectly out of housing demand. Derived demand is directly related to the actual good's demand - more good's demand, more derived good's demand & less good's demand, less derived good's demand.

So, increase in demand of housing will increase demand of lumber, & decrease in demand of housing will decrease demand of lumber