Differentiating Between Market Structures Table and Questions
Fill in the matrix and describe differences in public and private goods, common resources, and natural monopolies. Use your book and the Tomlinson video tutorials as a tool to help you answer questions about market structures.
Example Is there a rival in consumption? Is it excludable?
Private Good
Name Plate for necklace Yes Yes
Public Good
Stop signs No No
Common Resource
Cattle Yes No
Natural Monopoly
First Choice Electric No Yes
1. What is the difference between a public good and a private good?
A public good is when the good is neither rival in consumption and excludable while private goods on the other hand are rival in consumption and excludable. Public goods means anyone can have it that is why it is not excludable but with the private good only that one person can have that special one..
2. What is a common resource?
A common resource is only rival in consumption but it is not excludable. When one person uses the resource it decreases the other person chances. Like cattle and fishes, if one person uses or catches too many they are just decreasing the chance of the other person.
3. What is a natural monopoly?
Natural monopoly is not rival in consumption but it is excludable because that person has it. For example, the First Choice Power is an electric company that is only in certain states. People must pay to get the electric company service but only in they live in one of the states like Texas.
