ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -What Are Capital Goods? Capital goods are physical assets that a company uses in the production process to manufacture products and services that consumers will later use. Capital goods include buildings, machinery, equipment, vehicles, and tools.

Detailed explanation-2: -Capital goods are man-made products used by a business to produce consumer or other capital goods. Consumer goods are products used by consumers. Capital goods include items like buildings, machinery, and tools. Examples of consumer goods include food, appliances, clothing, and automobiles.

Detailed explanation-3: -Production is the process of making or manufacturing goods and products from raw materials or components. In other words, production takes inputs and uses them to create an output which is fit for consumption – a good or product which has value to an end-user or customer.

Detailed explanation-4: -The factors of production are the inputs used to produce a good or service in order to produce income. Economists define four factors of production: land, labor, capital and entrepreneurship. These can be considered the building blocks of an economy.

Detailed explanation-5: -Capital comprises one of the four major factors of production, the others being land, labor, and entrepreneurship. Common examples of capital include hammers, tractors, assembly belts, computers, trucks, and railroads.