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ECON 1580 Discussion Assignment Unit 4

The document discusses several markets and whether they can be considered perfectly competitive. It finds that Coca-Cola and Pepsi cannot be produced in a perfectly competitive market due to their distinct brand differences. Private physicians also cannot be in perfect competition as they set their own prices. However, potatoes and oats are found to be perfectly competitive as their goods are identical and indistinguishable between producers.

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76 views1 page

ECON 1580 Discussion Assignment Unit 4

The document discusses several markets and whether they can be considered perfectly competitive. It finds that Coca-Cola and Pepsi cannot be produced in a perfectly competitive market due to their distinct brand differences. Private physicians also cannot be in perfect competition as they set their own prices. However, potatoes and oats are found to be perfectly competitive as their goods are identical and indistinguishable between producers.

Uploaded by

Tesfahun
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Coca-Cola and Pepsi cannot be produced in a perfect competitive industry.

Because they
are produced and packaged not under the same brand, "Economists occasionally claim that
the products or services in a market with perfect competition are homogenous, which
basically means that they are all the same. In a market that is highly competitive, there are no
brand differences. (Rittenberg, L. & Tregarthen, T., 2009) As a result, Coca-Cola and Pepsi
are distinct brands that can be clearly distinguished.
Potatoes are perfectly competitive because they are all identical and are grown by a vast
number of farmers, potatoes can be produced in a market that is totally competitive. The
potatoes are not branded, and the ones grown by one farmer and those grown by another are
the same.
Private physicians in your local community – are not in perfect competition. Because
Firms should be price takers in an ideal competitive market. A doctor is someone who will
offer services to members of the community based on the knowledge and expertise they have
gained. They set their own pricing depending on the volume of services they have rendered;
as a result, they are price creators rather than price takers. Due to the nature of interactions
when receiving the services, which cannot be simply broken and the trust formed can make it
tough for someone new to come and succeed, their relationships with the people are more
warm and solid as they are giving the services to members of the community.
Government bonds and corporate stocks - Two firms/companies operate in distinct ways,
which affects the quality of their products. As a result, the quality of their stock or bonds is
different as well, because of their capacity in terms of the financial strength and control of the
operations, returns and benefits, market setup, quality of bond and stock, and other factors.
These two can be distinguished from one another and cannot be produced in a market with
perfect competition.
Taxicabs in Lima, Peru- Because of the ways in which their services vary, this cannot be
generated in a market that is completely competitive. Due to the abundance of pricing
information, these taxi drivers set their own prices based on location and distance, making
them price makers.
Oats – is perfectly competitive The oats market is distinguished by the presence of numerous
businesses or farmers, but despite this, their goods are identical and cannot be distinguished,
making the market homogeneous, which means that they are all the same. The farmers are
price takers. in a market that is intensely competitive, brands are identical. These farmers
have complete freedom to enter the market and to depart at any time.
References
Rittenberg, L. & Tregarthen, T. (2009). Principles of Economics: Competitive Markets for
Goods and Services.
https://my.uopeople.edu/pluginfile.php/1278207/mod_book/chapter/285783/Principles%20Of
%20Economics%20Chapter%2009.pdf

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