Intermediate goods - What are they? characteristics, examples, and more

Intermediate goods

Set of goods used as resources for production operations.

What are intermediate goods?

Intermediate goods are a set of goods used as resources for production operations. In other words, they are those raw materials that participate in the manufacturing process of a good.

For example, intermediate goods are the water used in production activities in a textile factory, the gasoline used by an engine, the coal used by a furnace in a metal manufacturing company, among others.

Since they are raw materials, these goods can only participate once in the production processes, since they usually undergo chemical alterations that modify their characteristics. However, depending on the raw material to be treated and the final production objective, sometimes they may not be altered.

Characteristics of intermediate goods

The main characteristics of intermediate goods are as follows:

• They require the alteration of certain characteristics to exploit their benefits.
• They participate directly in the production of a good.
• They play a fundamental role in production processes.
• They are limited.
• For its exploitation, external intervention is required, either by human hands or machinery.

Examples of intermediate goods

Here are some examples of intermediate goods:

• Petroleum: used as fuel for motors or, in other cases, for the direct manufacture of goods, for example, perfumes, makeup, paints, detergents, etc.
• Cotton: used for the manufacture of goods, such as paper money, textiles, oils, gunpowder, among others.
• Milk: used for the manufacture of goods, such as cheese, yogurt, butter, powdered milk, etc.
• Copper: used for the manufacture of goods such as coins, circuits, jewelry, kitchen items, etc.
• Wood: used for the manufacture of goods, such as tables, furniture, paints, sunscreens, among others.
• Cocoa: used for the manufacture of goods such as cocoa powder, chocolate, liqueurs, beauty products, etc.

 

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