Producing goods can add to net wealth, but rendering services cannot. Explain.
What will be an ideal response?
ANS:
A good can be of greater value when produced than the resources used to produce it. Therefore it adds to our wealth. Since a service is consumed as it is produced, it does not add wealth. It is counted as income, however.
Economics
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Explain the long-adjustment process that take place in a monopolistically competitive industry that is earning pure economic profits
What will be an ideal response?
Economics
If the Fed decides to engage in an open market operation to increase the money supply, what will it do?
a. Sell Treasury bonds, bills, or notes on the bond market. b. Buy Treasury bonds, bills, or notes on the bond market. c. Increase the required reserve ratio. d. Increase the fed funds rate.
Economics