Merchantable quality of goods refers to the standard or condition that goods must meet in order to be considered suitable for sale in the market. It implies that the goods must be of a certain quality, free from defects, and capable of fulfilling their intended purpose. This concept is important as it protects consumers from purchasing substandard or faulty goods.

1. Free from latent defects:
- Goods being free from latent defects means that they do not possess any hidden or concealed flaws that may affect their performance or safety.
- Latent defects are not immediately apparent upon inspection and may only become evident after the goods have been used for some time.
- For example, a television may appear to be in good working condition at the time of purchase, but it may have a latent defect that causes it to malfunction after a few months of use.
- Merchantable quality requires that goods are free from such defects and are capable of performing as expected.

2. Marketable at their full value:
- Goods being marketable at their full value means that they are in a condition that allows them to be sold in the market without any significant reduction in their value.
- This implies that the goods must be in a state that is acceptable to potential buyers and that they can be sold at a price that reflects their true worth.
- If goods have defects or are in a condition that significantly diminishes their value, they may not be considered to have merchantable quality.
- For example, if a car has a damaged engine or a cosmetic flaw that affects its resale value, it may not be marketable at its full value.

3. Fit for the purpose:
- Goods being fit for the purpose means that they are suitable and capable of being used for the specific purpose for which they were purchased.
- If goods cannot fulfill their intended purpose, they may be considered to lack merchantable quality.
- For instance, if a blender is unable to blend ingredients properly or a pair of shoes is uncomfortable to wear, they would not be considered fit for their intended purpose.

Conclusion:
Merchantable quality of goods encompasses the idea that goods should be free from hidden defects, marketable at their full value, and able to fulfill their intended purpose. It ensures that consumers receive goods of a certain quality and protects them from purchasing substandard or faulty products.