Goods and services are the outputs offered by businesses to satisfy the demands of consumer and industrial markets. They are differentiated on the basis of four characteristics:

1. Tangibility: Goods are tangible products such as cars, clothing, and machinery. They have shape and can be seen and touched. Services are intangible. Hair styling, pest control, and equipment repair, for example, do not have a physical presence.
2. Perishability: All goods have some degree of durability beyond the time of purchase. Services do not; they perish as they are delivered.
3. Separability: Goods can be stored for later use. Thus, production and consumption are typically separate. Because the production and consumption of services are simultaneous, services and the service provider cannot be separated.
4. Standardization: The quality of goods can be controlled through standardization and grading in the production process. The quality of services, however, is different each time...