Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Capital goods production will decrease due to limited resources.
B
Capital goods production will increase to meet consumer demands.
C
Capital goods production will remain unchanged regardless of consumer goods output.
D
Capital goods production will temporarily stop until consumer goods are produced.
Understanding the Answer
Let's break down why this is correct
Answer
When a country chooses to produce more consumer goods, it often means that it will have to reduce the production of capital goods, which are items used to make other goods, like machinery or buildings. This is because resources such as labor, materials, and time are limited, so focusing on one type of production usually comes at the cost of another. For example, if a country decides to make more cars for people to buy, it might have to cut back on making machines that help build those cars. This trade-off illustrates the concept of opportunity cost, where the opportunity to invest in capital goods is lost in favor of more immediate consumer needs. Ultimately, while producing more consumer goods can boost short-term satisfaction, it may hurt future production capabilities if capital goods are neglected.
Detailed Explanation
When a country focuses on making more consumer goods, it uses resources like money and workers. Other options are incorrect because Some might think that making more consumer goods means we need more capital goods; It's a common mistake to believe that production levels don't affect each other.
Key Concepts
Opportunity Cost
Resource Allocation
Production Choices
Topic
Opportunity Cost Analysis
Difficulty
easy level question
Cognitive Level
understand
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