00:01
Here we're classifying each market as perfectly competitive, monopolistic, or monopolistically competitive.
00:08
A, wooden number two pencils.
00:11
This is a perfectly competitive market because there are a large number of producers who can produce and sell pencils which are homogeneous.
00:55
Since each producer forms a small proportion in the total market, they are price takers.
01:09
B, copper.
01:11
This is a perfectly competitive market.
01:19
As there are a number of producers producing identical copper.
01:38
Since each producer forms a small proportion in the total market, they are price takers.
01:49
C, local electricity service.
01:52
This is a natural monopoly, so to say monopolistic.
02:12
They are the largest supplier of the service and have a cost advantage over other competitors.
02:45
D, peanut butter...