9.1 Types of Demand

Joint Demand

This refers to the demand for goods that are jointly demanded together. Complementary demand is also called joint demand. Demand is said complimentary when two products are necessary to meet one demand. It said to occur when two commodities are needed to satisfy one need. Example, cars need gasoline or diesel fuel. An increase in the demand for motor cars leads to an increase in the demand for fuel.

Competitive demand

This is the demand for commodities that have similar functions to the consumer. In other words, it is the demand for commodities that complete whose usage is the same to the consumer. When commodities are close substitute, the demand for such commodities are said to be competitive. A change in the demand for one of these goods causes a similar change in demand for the other e.g. fish and meat.

9.1 Types of Demand

Derive demand

As the name implies, it is the demand that arises as a result of the demand for other goods. Similarly, when a commodity is demanded for the satisfaction of another commodity, the demand is said to be derived. This is to say that, the demand for a commodity necessitates the demand for another commodity. Derived demand is also refers to the relationship between the resources used to produce a good or service, called factors of production. The factors of production include land, labour and capital are use to make produce final output or service (finished product) that are offer for sale in the market. As demand for the finished product increases, demand for the resources used to produce that good increases. However, decreased demand for the final product reduces demand for the factors of production. Example, an increase in the demand for Proton cars increases Proton manufacturers' demand for labour in assembly plants.

Composite demand

This refers to the demand for commodities that has dimensional uses to the consumer. If a particular goods or service is demanded to satisfy different needs of the consumer, that demand is said to be composite. Meaning that is deriving different satisfaction from a particular commodity. A good example of a commodity that has composite demand is crude oil. Crude oil is needed to produce different petroleum products such as petrol, kerosene, cooking gas, Petroleum Jelly, etc.