Mr. Gareth owns a toy-manufacturing company. Which of these items in his company is an intermediate good?
a. Toy plane
b. Doll house
c. Plastic sheets
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Answer is doll house
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Plastic sheets are an intermediate good in his company.
An intermediate good is an item that is used to in the manufacturing process to make other goods. They are the materials used by manufacturers in the process of creating the products that they sell to their customers.
Mr. Gareth needs the plastic sheets to manufacture the toy plane and doll house that he then sells.
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