Final good
Encyclopedia
In economics
final goods are goods that are ultimately consumed rather than used in the production of another good. For example, a car sold to a consumer is a final good; the components such as tires sold to the car manufacturer are not; they are intermediate goods used to make the final good.
When used in measures of national income and output
the term final goods only includes new goods. For instance, the GDP
excludes items counted in an earlier year to prevent double counting
of production based on resales of the same item second and third hand. In this context the economic definition of goods includes what are commonly known as services.
Consumer goods are final goods specifically intended for the mass market
. For instance, consumer goods do not include investment
assets, like precious antiques, even though these antiques are final goods.
Manufactured goods are goods that have been processed by way of machinery. As such, they are the opposite of raw material
s, but include intermediate goods as well as final goods.
Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...
final goods are goods that are ultimately consumed rather than used in the production of another good. For example, a car sold to a consumer is a final good; the components such as tires sold to the car manufacturer are not; they are intermediate goods used to make the final good.
When used in measures of national income and output
Measures of national income and output
A variety of measures of national income and output are used in economics to estimate total economic activity in a country or region, including gross domestic product , gross national product , and net national income . All are specially concerned with counting the total amount of goods and...
the term final goods only includes new goods. For instance, the GDP
Gross domestic product
Gross domestic product refers to the market value of all final goods and services produced within a country in a given period. GDP per capita is often considered an indicator of a country's standard of living....
excludes items counted in an earlier year to prevent double counting
Double counting (accounting)
Double counting in accounting is an error whereby a transaction is counted more than once, for whatever reason. But in social accounting it also refers to a conceptual problem in social accounting practice, when the attempt is made to estimate the new value added by Gross Output, or the value of...
of production based on resales of the same item second and third hand. In this context the economic definition of goods includes what are commonly known as services.
Consumer goods are final goods specifically intended for the mass market
Mass market
The mass market is a general business term describing the largest group of consumers for a specified industry product. It is the opposite extreme of the term niche market.-General:...
. For instance, consumer goods do not include investment
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
assets, like precious antiques, even though these antiques are final goods.
Manufactured goods are goods that have been processed by way of machinery. As such, they are the opposite of raw material
Material
Material is anything made of matter, constituted of one or more substances. Wood, cement, hydrogen, air and water are all examples of materials. Sometimes the term "material" is used more narrowly to refer to substances or components with certain physical properties that are used as inputs to...
s, but include intermediate goods as well as final goods.