Finished goods can be divided into two categories:

  1. Capital Goods are products that help increase the future production capacity of a country, for example, equipment, machines, plows, and buildings.
    The end users of capital goods are usually firms.

  2. All products that are not capital goods are consumer goods. Consumer goods are made for day-to-day use in order to fill immediate needs, like food, or long- term needs, such as clothing, jewelry, televisions, and refrigerators. Consumer goods are usually used by ordinary people.

The Difference Between Capital Goods and Consumer Goods