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Types of Goods in Economics

A) Macroeconomics

  • Final good Goods used for final consumption.
  • Used by the end-consumers/users. It satisfies customer’s wants directly 
  • Known as final goods because once it has been sold it passes out of the active economic flow.
  • No further transformation is made by any producer.
  • May undergo transformation process by purchaser but that is not come under economic activity as it doesn’t yield anything.
  • E.g.: tea leaves used at home to make drinkable tea, milk etc.

Consumption goods 

  • Consumed by ultimate consumers 
  • Non-durable: perishable in nature, e.g. food, clothing etc.
  • Consumer-Durable: car, furniture, television etc. 

Capital goods

  • machines, implements, tools
  • E.g. Printer
  • Make the production of other commodity feasible.
  • Durable in nature

Intermediate good

  • Goods that are used for further production is called intermediate goods also called inputs. 
  • It is further goes into transformation process. 
  • It adds earning in active economic activity. 
  • Tea leaves used by restaurant to make drinkable tea 
  • Therefore, Types of goods is not depending on nature of goods but it depends on economic nature of its use.
  • Goods used for the production of other goods 
  • Goods used by producers as material inputs 
  • Plants, machinery, factory
  • E.g. cotton yarn used to make cloth, 
  • Wood used to make furniture etc.

B) Micro economics 

  • Inferior good 
  • Inferior goods are goods whose demand decreases as income increases. 
  • Increase in income causes a fall in demand. 
  • E.g. When income of an individual increases, spends less on cheap cloth.
  • Goods are cheap in nature. 
  • Potatoes, baked beans etc.

Superior good/ normal goods 

  • Demand increases as income 
  • increases increase in income cause to increase in demand
  • expensive in nature 
  • e.g. vacation trips 

Luxury goods

  • Demand increases more than proportionally as income rises.
  • Goods has good quality, durability and remarkably superior in nature. 
  • E.g. Gold ornaments

Prestige goods 

  • Goods which give high prestige, status and value these goods are limited in nature 
  • e.g. antique collections

Giffen goods 
  • Increase in price causes increase in demand. 
  • E.g. Wheat

Complementary goods 

  • Goods which are used together. 
  • E.g. Pencil and sharpener

Substitute goods

  • Goods which can used in place of other.
  • E.g. Pepsi and coke