Decision to produce more capital goods - Macroeconomics Question

Question

Why does a decision to produce more capital goods today have to go hand-in-hand with a decision to produce less consumer items in the current era in a fully employed economy?

Answer 1

Capital goods are plants, equipment and buildings. These are inputs used by businesses to make goods for productive use in the future. Capital investment are made by companies to make capital goods. Consumer goods are used by consumers for immediate use - it has no productive use in the future. In a full employment economy there's opportunity cost involved between capital goods and consumer goods.

Capital goods are preferable because it promotes innovation and growth in the economy.