A Level Economics AQA Practice Exam

Which term describes a situation where one person's consumption reduces the availability for someone else?

1. Excludability

2. Rivalrous

3. Quasi-public

4. Market failure

The correct answer is: Rivalrous

The term that describes a situation where one person's consumption reduces the availability for someone else is "rivalrous." This concept is fundamental in economics, particularly when discussing types of goods. Rivalrous goods are those that cannot be consumed by multiple individuals simultaneously; when one person uses or consumes a rivalrous good, it diminishes the quantity or quality available for others. For instance, consider a slice of pizza. If one person eats that slice, it is no longer available for anyone else to eat. This characteristic contrasts with non-rivalrous goods, such as public information, where one person's use does not prevent others from using the same resource. Other choices like excludability refer to whether people can be prevented from using a good or service, quasi-public relates to goods that have some characteristics of public goods but are only partially accessible, and market failure describes situations where the allocation of goods and services is not efficient. None of these terms specifically captures the essential concept of consumption reducing availability for another, which is the essence of what makes goods rivalrous.