Question

Which among the following are final goods and which are intermediate goods? Give reasons.

1) Milk purchased by a tea stall

2) Bus purchased by a school

3) Juice purchased by a student from the school canteen

Answer 1

Milk purchased by tea stall – Intermediate good as milk will be used as an input to make the final product i.e. tea.

Bus purchased by school- Final good as bus will be used by the school. School is the final user of bus.

Juice purchased by a school student from the canteen- Final good as juice will be consumed by the student. Here, student is the final user of juice.