The factor of production which has itself been produced and which is not generally entirely consumed in the production process is:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Capital
Capital is a factor of production that has itself been produced. Machines and tools are examples. They are not used up in one round of production.
Intermediate goods are also produced, but they are used up in production.
NCERT (2026-27): Glossary: “Capital – Factor of production which has itself been produced and which is not generally entirely consumed in the production process.” Glossary: “Intermediate goods – Goods which are used up during the process of production of other goods.” |