Explanation:

Introduction:
Larger production of goods refers to the increased production of goods or an increase in the quantity of goods produced in an economy. This can have various effects on different types of goods. In this case, we are considering the impact of larger production on capital goods.

Capital Goods:
Capital goods are goods that are used in the production of other goods and services. They include machinery, equipment, tools, buildings, and infrastructure. The production of capital goods is essential for the expansion and growth of an economy.

Increased Production of Capital Goods:
When there is a larger production of capital goods, it leads to several positive effects on the economy.

1. Increased Productivity: The availability of more capital goods allows for increased productivity in the production process. This is because capital goods help in mechanizing and automating production processes, leading to higher output per unit of input.

2. Economies of Scale: Larger production of capital goods enables economies of scale. This means that as the production of capital goods increases, the average cost of producing each unit decreases. This can lead to lower prices for capital goods, making them more affordable for businesses and encouraging further investment in capital goods.

3. Improved Technology: The production of capital goods often involves the adoption and development of new technologies. As the production of capital goods increases, the economy benefits from technological advancements, which can further enhance productivity and efficiency.

4. Increased Investment: Larger production of capital goods creates a positive investment climate. When businesses see that there is an increased production of capital goods and improved technology, they are more likely to invest in expanding their production capacities. This leads to increased investment in the economy, which contributes to future production.

Conclusion:
In conclusion, larger production of capital goods has several positive effects on the economy, including increased productivity, economies of scale, improved technology, and increased investment. These factors contribute to higher production in the future as they enhance the capacity of the economy to produce goods and services efficiently.