1.1 - Nature of economic problem + types of goods

Question 1

Public goods

Answer 1

Goods provided by the government - can be used by everyone. They are also goods that no one can exclude people from enjoying their benefits. For example - street lights, national defence, etc.

Question 2

Free goods

Answer 2

A product that does not require economic resources to produce, and does not have an opportunity cost. For example - sunlight, air, etc.

Question 3

Economic goods

Answer 3

A good that requires resources to produce, and therefore has an opportunity cost.

Question 4

Capital goods

Answer 4

Physical assets that a company uses in the production process to manufacture products and services that consumers will later use.

Question 5

Consumer goods

Answer 5

Good that satisfies an immediate consumer’s need or want.

Question 6

Consumer durables:

Answer 6

consumer goods that last for a long time, eg: cars, televisions, etc.

Question 7

Non-durable goods:

Answer 7

perishable goods or goods that are used up quickly such as food, water, etc.

Question 8

Merit goods

Answer 8

Goods are beneficial for the economy or social welfare that the government provides because the private sector doesn’t provide enough. For example - healthcare and education.

Question 9

Demerit goods

Answer 9

Goods that don’t benefit the society