Question

Purva runs a company that weaves cloth. She also owns a retail shop where she sells fabric to consumers. She also sells the material to those who then make ready-made clothes. To which category does Purva's company belong?

• A. Consumer goods industry
• B. Capital goods industry
• C. Joint industry
• D. Private industry

Answer 1

Answer: (A), (B), (D)

Private industry

Based on users, industries are classified into consumer and capital goods industries. Based on ownership, industries are classified into privately-owned, publicly-owned, and jointly-owned industries.

Since the final consumers purchase cloth, Purva's business is a consumer goods industry. The cloth is also consumed by other industries, which is why it is also a capital goods industry. Since Purva privately owns it, it is also a private industry.