Question

Which of the following is an example of a consumer good?

• A. A machine used in a factory
• B. A taxi purchased by a company for commercial use
• C. A refrigerator bought for home use
• D. A building purchased by a firm for office space

Hint:

If a good is bought by a household for direct use, it is a consumer good. If it is used by a firm for production or business, it is a capital good.

Answer 1

The Correct Option is C

Step 1: Understanding the Concept:
The distinction between a consumer good and a capital good depends on the end-use of the product. If used for personal satisfaction, it is a consumer good.
Step 2: Detailed Explanation:
- Option (A): A factory machine is used to produce other goods; it is a capital good.
- Option (B): A taxi for a company is a fixed asset used to generate revenue; it is a capital good.
- Option (C): A refrigerator bought for home use satisfies the final wants of the household directly; it is a durable consumer good.
- Option (D): An office building is a fixed asset for a business; it is a capital good.
Step 3: Final Answer:
Only option (C) identifies an end-use for personal/household consumption.
Therefore, option (C) is correct.