ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Capital goods serve a critical role in the economy. When companies invest in capital goods, they expand their ability to create products and services. This allows businesses to make a profit and hire employees, and can result in economic growth for society as a whole.

Detailed explanation-2: -Tools, machinery, buildings, vehicles, and computers are examples of capital goods. Some items can be both capital goods and consumer goods depending on how they are used.

Detailed explanation-3: -Rising trade and sweeping technological improvements have led to more efficient production of capital goods. This has helped countries around the world raise real investment and improve living standards.

Detailed explanation-4: -Additional or improved capital goods is intended to increase labor productivity by making companies more productive and efficient. Newer equipment or factories leads to more products being produced, and at a faster rate.