Commodity Definition

A Commodity is an object that functions in an economy. Examples of commodities are wheat, rice, copper, gold, gasoline, or electricity. Commodities must satisfy a real and persistent market demand, but do so without a qualitative differentiation across a market. For example, when buying rice, the quality of rice is largely irrelevant to the price. On the other hand, when buying a non-commodity item such as computer the quality varies greatly, and the better the computer is the more it will cost.