If a person produces capital goods, she sacrifices current production of consumer goods in order to obtain the capability of producing more goods and services in the future.This is called roundabout production.

Question

Quizplus · Accepted Answer

Roundabout production involves sacrificing current production of consumer goods in order to invest in capital goods, which provide the capability of producing more goods and services in the future.

If a Person Produces Capital Goods, She Sacrifices Current Production