Different types of goods

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A brief description of different types of goods

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Different types of goods

  1. 1. Abhi
  2. 2. <ul><li>Goods used for final Consumption are called Consumer Goods </li></ul><ul><li>Eg. Food, Home, Car </li></ul><ul><li>Goods used for production of other goods are called Producer Goods </li></ul><ul><li>Eg. Plants, Machinery, Factory </li></ul>
  3. 3. <ul><li>Goods which are consumed finally </li></ul><ul><li>Satisfy customer’s wants directly </li></ul><ul><li>The analysis used to study Consumed Goods is called Demand/ Revenue analysis </li></ul>
  4. 4. <ul><li>Can be used to produce Consumer goods or Producer goods themselves </li></ul>
  5. 5. Consumer Good Producer Good
  6. 6. <ul><li>According to Layman, goods perishable after use are called non-durable goods </li></ul><ul><li>Later new economics definition came ; non-durable goods are goods perishable after one use .Eg. Bread, Milk, </li></ul><ul><li>Purchased at regular intervals </li></ul><ul><li>Only current demand to be met corresponding to current conditions </li></ul><ul><li>Serviceability not generally required </li></ul><ul><li>Classified into perishable and non perishable goods </li></ul>
  7. 7. <ul><li>Perishable goods are lost after a period of time </li></ul><ul><li>Eg. Teaching Services, Doctor’s service, Medicines </li></ul><ul><li>Non-perishable goods are not lost after a period of time </li></ul><ul><li>Eg. Coal </li></ul>
  8. 8. <ul><li>Goods being used for a continued period of time. Eg.TV, refrigerator </li></ul><ul><li>It either satisfies new demand or replace old set. </li></ul><ul><li>Requires special facilities to use. Eg. Car needs Petrol Pump, Refrigerator needs Electricity. </li></ul><ul><li>Consumed by more than one person.Eg. TV, Radio </li></ul><ul><li>Serviceability is required. So segregation of new demand and service required </li></ul><ul><li>Demand analysis is heavily complex </li></ul>
  9. 9. <ul><li>A good whose demand increases when income increases and demand decreases when income decreases. </li></ul><ul><li>It’s price remains the same </li></ul>
  10. 10. <ul><li>Inferior goods are goods whose demand decreases as income increases. </li></ul><ul><li>It has negative elasticity of demand </li></ul><ul><li>Eg. A Man who had a recent hike in salary pay less on cheap dress. </li></ul><ul><li>Superior gods are goods whose demand increases as income increases </li></ul><ul><li>It has high positive elasticity of demand </li></ul>
  11. 11. <ul><li>In Ireland, the poor people used to consume more potatoes(inferior good) and less meat using their miniscule daily budget </li></ul><ul><li>During a famine when cost of potato was increased it was found that the consumption of potato has been increased </li></ul><ul><li>This phenomenon defied the law of demand as of then, and was called the Giffen paradox </li></ul>
  12. 13. <ul><li>In economics, a luxury good is a good for which demand increases more than proportionally as income rises. </li></ul><ul><li>It has a high elasticity of demand </li></ul><ul><li>Their quality, durability or performance that are remarkably superior to the comparable substitutes Eg. Gold ornaments </li></ul><ul><li>Needs good Brand Power </li></ul><ul><li>With time can assume status of normal goods </li></ul>
  13. 14. <ul><li>Goods which ascribe high status and value </li></ul><ul><li>Eg. Antique Collections, Limited Edition Goods </li></ul><ul><li>Bought by richest section of people </li></ul>
  14. 15. <ul><li>A good's demand is increased when the price of another good is decreased. </li></ul><ul><li>It has negative cross elasticity of demand </li></ul><ul><li>Eg. Pencil and Eraser consumption in case of a accounting firm. </li></ul>
  15. 16. <ul><li>Managerial Economics, GS Gupta, Tata-McGraw Hill, 2007 </li></ul><ul><li>Principles of Economics, DN Dwivedi, Prentice Hall India, 2004 </li></ul><ul><li>Managerial Economics, R L Varshney and KL Maheshwari, Sultan Chand & Sons, 2005 </li></ul><ul><li>Modern Economic Theory, KK Dewett, S. Chand & Company Ltd, 2005 </li></ul><ul><li>Managerial Economics, Dr. MS Subrahmanian, Ramesh Publications, 1995 </li></ul><ul><li>http://www.moneyterm.co.uk </li></ul>

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