Difference between consumption and capital goods

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Difference between consumption and capital goods

Posted by Sujita Sahu 4 years, 9 months ago

CBSE > Class 12 > Economics

2 answers

Meghna Thapar 4 years, 9 months ago

Capital goods are goods used by one business to help another business produce consumer goods. Consumer goods are used by consumers and have no future productive use. Capital goods include items like buildings, machinery and tools. Examples of consumer goods include food, appliances, clothing and automobiles. Human capital relates to the expected goods people should be able to produce, whereas, capital goods focus on the total output people produce. ... Human capital is the investment humans make in factories and machinery, whereas, capital goods are the investment humans make in education to produce technology.

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Muskan Janghu 4 years, 9 months ago

Consumption Goods :- 1.These goods satisfy human wants directly. So, such goods have direct demand. 2. They do not promote production capacity. 3. Most of the consumption goods (except durable goods) have limited expected life. Capital Goods :- 1. Such goods satisfy human wants indirectly. So, such goods have derived demand. 2. They help in raising production capacity. 3. Capital goods generally have an expected life of more than one year.

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