Axia College Material

Appendix C

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 Is it excludable?

consumption?

Private Good Insurance No, this can be Yes, in order to

used by others at have insurance you
the same time. must pay for it.
Public Good Learning No, everyone can No, one can learn
learn at the same about anything and
time. It is not everything.
something that can
be taken away from
you.
Common Resource Clean Air Yes, we all No, air is all around
compete for clean for us to breath. It
air to breath. is not controlled by
an organization.
Natural Monopoly Utilities No, because the Yes, you must pay
cost to implement to use this service.
or maintain are too
great.

1. What is the difference between a public good and a private good?

A private good is made for profit. It is excludable and has a rival. Insurance is a
good example of this. A public good is non-rival and non-excludable. Learning is
a good example of this. It has no rivals and you can learn whenever you like.

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2. What is a common resource?

Goods that are rival in consumption but not excludable. Clean air is a common
resource. This is a common resource because we are entitled to use it. We
compete for clean air because it is unlimited and polluted by factories and other
things.

3. What is a natural monopoly?

A monopoly that arises because a single firm can supply a good or service to an
entire market at a smaller cost than could two or more firms. Utilities companies
are good examples. In order to get your water or electricity you must pay for it
from them.

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