Question

Chapter 2 - Economics
11) Identify each of the goods and services below as either capital goods or
consumption goods and services.

a. Restaurant meals
b. Oven in a restaurant
c. Oil rig
d. Haircut
e. Factory
f.  Dining room table in a house
g. Table in a restaurant
h. Golf course
i.  A round of golf

Answer 1

a. Services and consumption goods

b. Capital goods

c. Capital goods

d. Services

e. Capital goods.

f. Consumption goods

g. Capital goods.

h. Service goods.

I. Capital goods .

Capital goods are physical assets which are used by companies in production process to produce finished consumer goods. They are brought by factories, firms etc ,.example building, machinery, vehicles, and tools. They are used to make finished goods.

Consumption goods- are also called as final goods. They are used by consumer to satisfy their wants and needs. Clothing, food, jewellery etc.

Services- activities provided by professional or other like doctors, advocates, workers , barbers, etc