Professional Documents
Culture Documents
Chap 1
Chap 1
Chap 1
Types of Goods
Free Goods: Free goods are goods the production of which involves no opportunity cost. Ex.
Air
Economic Goods: Economic goods are those goods the production of which involves an
opportunity costs. Ex. Table. The wood used to produce table may have been used for other
purposes.
Consumer Goods: These goods are used to satisfy our wants directly. They are used for their
own sake. Ex. Television.
Producer Goods (Capital goods): These goods do not satisfy our wants directly. They are
used to assist in further production. Ex. Bulldozer.
Durable Consumer Goods: These consumer goods lasts for a fairy long time. Ex. A family
car.
Non-Durable Consumer Goods: These consumer goods do not last very long time. They are
used up immediately or in a short period of time. Ex. Food
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ABU NAYEEM MOHAMMED SUYEEB
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Factors of Production
Factors of production are resources which assist in further production
Land: Any naturally available resources that helps in further production. Ex. Minerals in the
earth’s surface.
Labour: Any mental or physical human effort that helps in further production. Ex. A
construction worker.
Capital: Any man made resource that helps in further production. Ex. A sewing machine.
Entrepreneur: The risk taker and decision maker of the business. He/she organizes the other
factors of production.
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