If a country increases the production of its capital goods,then

Question

Quizplus · Accepted Answer

By increasing the production of capital goods, a country is sacrificing the production of consumer goods in the present. However, in the future, the increased production of capital goods will result in higher productivity and more efficient production, leading to a greater production of both capital and consumer goods. So, while the country may have less consumption in the present, it will have more consumption in the future.

If a Country Increases the Production of Its Capital Goods,then