Which of the following correctly identifies the two major types of markets in economics?

• A. Product markets and factor markets
• B. Domestic markets and international markets
• C. Primary markets and secondary markets
• D. Monopoly markets and competitive markets

Answer: (A)

Verified step by step guidance

1. Understand that in economics, markets are broadly categorized based on what is being exchanged.
2. Recognize that 'product markets' refer to markets where final goods and services are bought and sold by consumers and firms.
3. Identify that 'factor markets' are markets where factors of production (such as labor, capital, and land) are bought and sold.
4. Note that other options like 'domestic vs. international markets' or 'primary vs. secondary markets' refer to different classifications but are not the major types in economic theory.
5. Conclude that the two major types of markets in economics are 'product markets' and 'factor markets' because they cover the exchange of goods/services and inputs for production, respectively.