Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Increased wages for workers
B
Investments in productive assets
C
Government intervention
D
Decreased consumer demand
Understanding the Answer
Let's break down why this is correct
Answer
In a capitalist economy, capital accumulation primarily happens through the process of investment and profit generation. Businesses invest money to produce goods or services, and when they sell these products, they earn profits. This profit is then often reinvested into the business to expand operations or improve production, which leads to more profits over time. For example, a coffee shop might use its earnings to buy better equipment or open a new location, allowing it to make even more money. However, this process can also involve exploitation, as workers may not receive fair wages for their labor, allowing owners to keep a larger share of the profits.
Detailed Explanation
In a capitalist economy, people and companies invest money to buy things that help them make more money. Other options are incorrect because Some might think that paying workers more leads to more capital; Many believe that government actions create capital accumulation.
Key Concepts
Capital accumulation
Topic
Exploitation in Capitalism
Difficulty
easy level question
Cognitive Level
understand
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