Your firm is successfully marketing jellies and jams to restaurants in the Northeast, and now you want to expand into the Midwest. However, your selling team has warned that high unemployment in the region is likely to hamper initial sales. A new marketing intern doesn't see the connection, pointing out that unemployment affects consumers, not businesses.
Which of the following statements should you make to help him understand the connection?
a. Consumers and businesses exhibit joint demand for products.
b. When consumers are unemployed, they cut back on restaurant meals, causing the restaurants to reduce their purchases of jelly, jam, and other supplies. This relationship is called inelastic demand.
c. Unemployment hurts businesses because it means they aren't hiring enough staff.
d. When consumers are unemployed, they cut back on restaurant meals, causing the restaurants to reduce their purchases of jelly, jam, and other supplies. This relationship is called derived demand.
e. Unemployment hurts businesses because it means an increased tax burden.