1. Terms to Know: There are some important economic terms for which you'll be responsible:

monopoly
homogenous
market power
monopolistic competition
product differentiation

See the definitions of these terms.

2. The Story of Fred's Grocery:

What about poor Fred! What does monopolistic competition, market power, and product differentiation have to do with this small business owner? Did he survive the big grocery store that moved in nearby? Let's find out....

Click on Fred to read his story. Print it out for easy reference.
IMPORTANT: The link will open in a new window. Close the new window to return to your Economics course.

ASSIGNMENT 6.4 REQUIREMENTS

After reviewing the links above, answer the following ten questions. Your answers should be in complete sentences using your own words. You must provide specific examples to support your answers.

1. What are some examples of homogenous businesses in the:
a) retail business?
b) restaurant business?
c) entertainment business?

2. Although the businesses you have identified in question #1 are homogenous, how do they attempt to differentiate themselves?

3. Today is your birthday! Imagine that you can dine at any restaurant of your choice to celebrate. Which restaurant would you choose? Explain how your favorite restaurant differentiates itself in such a way that you want to spend your money there.

4. Why was Fred's business in jeopardy?

5. Who were Fred's competitors? (There are two.)

6. Explain how Fred differentiated his business from ALL these competitors.

7. Explain the effects of Fred changing his business philosophy.

Now back to Ben & Jerry's

8. Describe one way in which Ben & Jerry's differentiates their products. In other words, what makes their ice cream different than their competitors? (This question has many answers as Ben & Jerry's has many types of competitors.)

9. Describe another way in which Ben & Jerry's differentiates their products.

10. If you were to go into business for yourself, what kind of business would you like to own? Describe how would you make it different from others like it.