The basic reason for the production of capital goods is to:
A)promote the concentration of economic power in the business sector.
B)facilitate exchange where a coincidence of wants does not exist.
C)better synchronize the operation of resource and product markets.
D)enhance future productive efficiency.

Question

Quizplus · Accepted Answer

The production of capital goods is aimed at enhancing future productive efficiency by creating long-term benefits such as increased production capacities or improved technologies. This will lead to increased output and income, and ultimately contribute to economic growth. However, the other options (A, B, C) do not adequately explain the purpose of capital goods production.

The Basic Reason for the Production of Capital Goods Is