Question

Which of the following is not a part of Final Expenditure?

2 points

(a) Consumer goods purchased by the government

(b) Consumer goods exported to rest of the world

(c) Seeds purchased by the farmers

(d) Government fixed investment expenditure
​

Answer 1

Answer:

d. Govt. fixed investment expenditure

Answer 2

Option (c) Seeds purchase by the farmers is not a part of Final Expenditure.

Explanation:

• Final goods are the consumer goods, they are the goods that satisfy consumers needs and wants.
• These goods are directly consumed by the actual consumers.

• Where as ,Intermediate goods are the good used in production process to make other goods , they are directly consumed by the producers.
• In the seed purchase by the farmer process the seeds give us food which are sold by the farmer . So, this is not a finish product.
• Hence seed is the intermediate process because it requires production so it is not final expenditure.