Question

'Machine purchased is always a final good.' Do you agree with the statement? Give reasons for your answer.

Answer 1

'Machine purchased is always a final good'- this statement is not true. For example: A machine purchase by a manufacturing company is a capital good which is to be used in the process of production. In this case, machine is the fixed asset of the producer. While, the same machine is purchased by a consumer, it is considered as a final good(durable-use consumer good).