Question

Butter is always a final product. Comment​

Answer 1

Final goods refer to those goods which are used either for consumption or for investment.

(i) Goods purchased by consumer households as they are meant for final consumption (like milk purchased by households).

(ii) Goods purchased by firms for capital formation or investment (like machinery purchased by a firm).

It must be noted that final goods are neither resold nor used for any further transformation in the process of production.