Question

Grapes are considered intermediate goods a. whether the purchaser uses them to make wine to sell or eats them. b. if the purchaser uses them to make wine to sell others but not if the purchaser eats them. c. if the purchaser eats them, but not if the purchaser uses to them to make wine to sell. d. None of the above is correct.

Answer 1

Answer: Grapes are considered intermediate goods if the purchaser uses them to make wine to sell others but not if the purchaser eats them.

Explanation: We call intermediate goods to goods that deplete their production process.

They are used to produce other goods and in its application to the production process it is fully incorporated into the product or transformed completely with the first use.

They are bought for resale or used as inputs or raw materials for the production and sale of other goods.

One example could be the flour used to make bread is an intermediate good for consumption. ( The bread is the final product that you buy on the store ) .