Principles of Macroeconomics / Unit 3 MAC 0208 short lesson, about 20 seconds
Final and Intermediate Goods
Captions available
The idea
A final good is bought by its last user. An intermediate good is bought to be used in producing something else, and counting both would be double counting.
In practice
Count the loaf, not the flour that went into it.
Where people slip
Flour unsold at the end of the year is counted, as an addition to inventories.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
Builds on
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