Discretionary Vs Non-Discretionary Products

This question tests whether you understand how consumer demand changes with the economy and how to classify products by purchase necessity. In investment banking interviews, especially for consumer and retail coverage, interviewers use this type of question to see if you can think about spending behavior, recession resilience, and why some businesses are considered more defensive than others. A strong answer should explain the difference in terms of whether purchases are essential or can be delayed, and connect that distinction to how companies in the sector may perform across the cycle.