Question

Give two examples for each of the following: (a) an intangible good, (b) a tangible good, \((\mathrm{c})\) a bad.

Short answer

(a) Two examples of intangible goods include legal services and education. (b) Two examples of tangible goods include a car and a shirt. (c) Two examples of 'bad' are pollution and waste.

Step-by-step solution

Identify two examples of intangible goods

Intangible goods are goods that we cannot physically touch, see or measure, they are non-physical in nature. Examples are legal services and education.

Identify two examples of tangible goods

Tangible goods are physical goods; they are items that we can see, touch, and measure. Examples are a car and a shirt.

Identify two examples of a 'bad'

In economics, a 'bad' typically refers to something undesirable. It doesn't mean that the item is of poor quality, but that it is something that people generally want to avoid if possible. Examples might be pollution and waste.

Key concepts

Intangible Goods

Intangible goods are unique because they do not have a physical presence that you can see or touch. This makes them different from the everyday items you might find in your home or at the store.
One way to think about intangible goods is to consider things we experience or use without holding them physically. For example, when you pay for a streaming service, you are purchasing the right to access content like movies and shows, not a physical DVD or Blu-ray. Another great example is an education. You pay for classes, and in return, you gain knowledge, not a material object.
These goods can include:

• Services, like legal advice or therapy, where you are benefiting from expertise rather than receiving a tangible item.
• Digital products such as eBooks, online music, or mobile apps which exist in a digital form and can be used or consumed through electronic devices.

Tangible Goods

Tangible goods are the physical items we can interact with directly. You might think of them as the things we buy, sell, or use regularly which take up space and can be physically handled.
A tangible good can be anything from a small pen to a large piece of furniture. These items have measurable characteristics like weight and volume. Consider a car: it is a physical object you can drive, park, and, importantly, see. Similarly, clothing like a shirt is tangible because you can touch and wear it.
Common examples include:

• Household items such as furniture, electronics, or kitchen utensils.
• Personal items, like clothing, shoes, or accessories.
• Technological products, like laptops or smartphones, which combine material components to provide utility.

Economic Bads

In microeconomics, an economic bad is an opposite notion to a good. Unlike goods which provide satisfaction or utility, bads are items or outcomes people usually want to avoid or minimize.
A classic example of an economic bad is pollution. It's not something you purchase but it can have negative effects on health and the environment. Similarly, waste such as trash or industrial byproducts are considered bads because they represent materials that are typically unwanted and require disposal, often with added effort or cost.
When evaluating economic bads, think about their impact:

• Environmental effects: Pollution leads to cleaner environments being highly valued as people strive to mitigate the bad's impact.
• Health implications: Prolonged exposure to harmful substances can decrease wellbeing, making these substances economic bads.
• Economic costs: The need to manage or eliminate bads often involves additional spending, like investing in waste management or reducing emissions.