Question

Define the following term.

Wealth

Answer 1

Wealth, in economics, refers to all those goods or assets which are relatively scarce and have money value.

Wealth includes both material goods like machines, household durables, gold and non-material things like goodwill of a businessman, copyrights, etc. 

For a commodity to be considered wealth, it must have the following characteristics:

1. Utility: It must have the power to satisfy human wants.
2. Scarcity: It must be scarce in supply relative to demand.
3. Transferability: It must be capable of being transferred from one person to another.
4. Externality: It must have an external shape or form that can be possessed or owned.

Hence, wealth is all valuable things that satisfy wants, are scarce, transferable and have an external form.