DECA+ Business Management and Administration Practice Exam 2025 - Free Business Management Practice Questions and Study Guide

The correct distinction between goods and services lies in the tangible versus intangible nature of these economic offerings. Goods are defined as tangible items that can be physically touched, seen, and used, such as furniture, clothing, and electronics. These items have a physical presence and can be owned and stored.

On the other hand, services are characterized by their intangible nature. They represent an action, benefit, or performance provided by one party to another. Examples include haircuts, education, and medical care, which cannot be physically possessed or stored. This inherent difference is crucial for businesses in terms of marketing, production, and customer service strategies.

The other choices present distinctions that do not accurately reflect the fundamental difference between goods and services. While some goods can be perishable (like food), many goods are not, making the first option misleading. The second option incorrectly categorizes goods as intangible, and services as tangible, which is precisely the opposite of the correct definitions. The final option suggests that services cannot be sold, which is inaccurate, as services are indeed sold in various industries. Thus, the tangible versus intangible distinction serves as the core differentiator in understanding the nature of goods and services.