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All machines are not capital goods …

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All machines are not capital goods explain
  • 4 answers

Preeti Dabral 3 years, 4 months ago

The end-use of the machine determines whether it is a capital good or not. Capital goods are those fixed assets of the producers which are used in the process of production for several years and which are of high value. Therefore, only those machines which are used in the process of production are considered to be capital goods. Those machines which are used by the households are not capital goods. For example, Computer used at home is a durable-use consumer good, but a computer used in the computer coaching class is a capital good.

Marja Sale Gobar Kha Ke 3 years, 5 months ago

Capital good means asset at both sides

Deepanshu Jha 3 years, 5 months ago

Yaa it's right it depend upon the person how they use if the person who is consuming in what manner the household purchase for the consumption purpose and dairy farm people purchase for investment purpose so

Shubhanshi Singh 3 years, 5 months ago

All machines are not capital goods like a sewing machine in a tailoring shop is a fixed asset of the tailor; it is a capital good. But the same machine with a consumer household is not a capital good.It is simply a durable use consumer good.likewise,a car with a tourist company is a capital good. But is the same car with a household is durable use consumer good. Thus, while identifying goods as capital goods,we must make sure about their end-user.If the end user of the durable good is a household consumer,it is durable use consumer good.On the other hand,if the end user of a durable good is a producer,it is a capital good.Capital goods are only those durable goods which are used as producer goods,not as consumer goods.
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