Question : Which of the following are true? Market price is always more than factor cost. A good can be an intermediate good in one case and a final good in another case. Option 1: Both are true. Option 2: Both are false. Option 3: Statement 1 is true and statement 2 is false ...

Question : Which of the following are true?

Market price is always more than factor cost.

A good can be an intermediate good in one case and a final good in another case.

Option 1: Both are true.

Option 2: Both are false.

Option 3: Statement 1 is true and statement 2 is false.

Option 4: Statement 1 is false and statement 2 is true.

Team Careers360 13th Jan, 2024

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Answer (1)

Team Careers360 15th Jan, 2024

Correct Answer: Statement 1 is false and statement 2 is true.

Solution : Market price can be less than factor cost if net indirect taxes are negative. Market price can also be equal to factor cost if net indirect taxes zero.
A good can be an intermediate good as well as final good depending upon its nature of use.
Hence, Option D is correct.

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