Answer:
Productive or technical inefficiency.
Step-by-step explanation:
Factors of production can be defined as the fundamental building blocks used by individuals or business firms for the manufacturing of finished goods and services in order to meet the unending needs and requirements of their customers.
In Economics, there are two types of inefficiency associated with the production of goods and services, these includes;
1. Allocative inefficiency: it occurs when businesses do not maximise output from the given inputs. Thus, it arises when businesses fail to increase the level of their production or productivity from a number of given inputs.
In conclusion, allocative inefficiency typically occurs when the price of a good or service isn't equal to its marginal cost i.e P ≠ MC.
2. Technical or productive inefficiency: it occurs when businesses produce goods and services that consumers do not want. This is typically as a result of the incorrect and inefficient allocation of scarce resources by a business firm or entity.
Hence, productive or technical inefficiency is a term for the statement: "when businesses produce goods and services that consumers do not want."