Question

Briefly explain whether each of the following transactions represents the purchase of a final good. a. The purchase of flour by a bakery b. The purchase of an aircraft carrier by the federal government c. The purchase of French wine by a U.S. consumer d. The purchase of a new airliner by American Airlines

Answer 1

Answer:

Explanation:

Option A is not an example of purchase of a final product , a bakery is an institution that uses flour to product IRS final goods, which are, bread,cakes etc do the purchase of flour by the bakery is not a finished product .

Option b is a purchase of finished good, as the aircraft is a finished product of engineering, it has undergone several processes before it became an aircraft ,so the aircraft is a finished good

Option c, the purchase of French wine by US consumer is an example of finished good, the wine is the finished good, the wine before it became a wine, it has passed through a several process but the finished good is the wine.

Same extends to option D , the new airline is a finished good, it is a new airline it has gone through process before it is been purchased as a new airline , any thing finished good must have passed through a process.