The same item can be an output for one producer and an input for another.

### Why this is right Whether an item is an input or output depends on its role in a particular production process. A producer's output may be purchased and used as another firm's input. ### The concept Production transforms inputs into outputs, but the labels are relational rather than permanent properties of an item. Following an item through a production chain helps clarify its role at each stage. ### Remember Classify an item by how a particular firm uses it.