Payments for Goods and Services That Will Be Used Up

question 265

Multiple Choice

Payments for goods and services that will be used up by households during the year are

• A)investment expenditures for the production of output.
• B)made by firms to households and called national income.
• C)called consumption expenditures.
• D)for intermediate goods and are not counted in GDP.

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Definitions:

Diseconomies of Scale

The phenomenon where, as a firm scales up its production, the per unit cost starts to increase, typically due to inefficiencies.

Economies of Scale

Economies of scale occur when a company reduces costs per unit due to an increase in production, typically achieved through operational efficiency and larger volume production.

Constant Returns to Scale

A situation in production where increasing all inputs by a certain factor results in output increasing by the same factor, indicating proportionate scalability.

AP

Advance Placement; a program in the United States and Canada offering college-level curriculum and examinations to high school students.