Which example illustrates an intermediate good?
A) stocks and bonds purchased by a business executive
B) a cellular telephone purchased by a college student
C) a wedding ring purchased by an engineer for his fiancée
D) tires General Motors purchased from Goodyear for new electric cars

Question

Quizplus · Accepted Answer

Intermediate goods are goods that are used to produce final goods. Tires purchased by General Motors from Goodyear are an intermediate good because they will be used to produce new electric cars. Choices A, B, and C are all final goods that are consumed directly by individuals, rather than being used in the production of another good.

Which Example Illustrates an Intermediate Good