Final answer:
A service is characterized as being intangible and must be consumed at the same time it is created. Unlike nondurable goods which have a physical presence and can be consumed over time, services like haircuts and education are consumed immediately and cannot be stored or saved for later use.
Step-by-step explanation:
A characteristic of a service is that it is intangible, since it cannot be stored and must be consumed simultaneously with its creation. Services are distinct from goods in that services are acts, efforts, or performances exchanged from producer to user without the ownership of any physically tangible product.
For instance, when you pay for a haircut, you receive a service provided by the hairdresser. Unlike a product like a bottle of shampoo that you can take home, a haircut is a service that is realized and consumed at the same time it is provided.
Another way to think about services is by contrasting them with goods. An example of a good is food or clothing, which are nondurable goods; they are short-lived and consumed quickly.
Services do not have physical presence or durability; instead, they often peak during key moments, such as the business cycle, or maintain a real value over time despite a lack of physical substance. Here, 'real value' refers to a value adjusted for inflation, as opposed to 'nominal value' which is not adjusted. Additionally, whereas the consumption of a good by one person precludes its consumption by another, services can sometimes be nonrivalrous - similar to a public good where usage by one individual does not diminish availability to others.