Refrigerator purchased by a confectionery shop is an example of:(a) Intermediate good(b) Final good and Capital good(c) Final good
Question
Refrigerator purchased by a confectionery shop is an example of:
(a) Intermediate good
(b) Final good and Capital good
(c) Final good
Solution
The refrigerator purchased by a confectionery shop is an example of a Final good and Capital good. Here's why:
- It's a Final good because it's not going to be resold or used in the production of another good. It's the end product bought by the confectionery shop.
- It's also a Capital good because it's a long-lasting good that the confectionery shop uses to produce other goods and services. In this case, the refrigerator is used to store and preserve the confectionery items.
So, the correct answer is (b) Final good and Capital good.
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