Question

Moving out from the food court, let's think about competition in the mall more generally. What types of goods and services sold in the mall are likely to be as competitive as the food court, and which ones are likely to be less competitive? Drag and drop the following items into the appropriate area below:

1. Blue jeans, which you can find in at least six different stores
2. Remote-controlled cars from one of the mall's two toy stores
3. Underwear from one of the mall's many department and specialty underwear stores
4. Baseball hats for obscure nonlocal teams from the mall store 'uniquelids'
5. Movie tickets at the only theater in the mall

Are these items relatively competitive or less competitive?
1) Relatively competitive
2) Less competitive

Answer 1

Goods such as blue jeans and underwear are relatively competitive due to multiple sellers and little differentiation between products, whereas baseball hats for nonlocal teams and movie tickets from a single theater are less competitive as they offer more unique attributes or limited availability.

Step-by-step explanation:

The degree of competition among various goods and services in a mall can be determined by the number of competing firms and the differentiation of their products, a concept known as monopolistic competition. The items mentioned, such as blue jeans and underwear that are available at many different stores, are relatively competitive due to the presence of multiple sellers and the lack of significant differentiation. Meanwhile, products like baseball hats for obscure nonlocal teams sold at a store like 'uniquelids' or movie tickets from a single theater in the mall are less competitive, as they feature more unique aspects or limited availability, giving the sellers some price control and a mini-monopoly on their specific offerings.

• Blue jeans, sold in at least six different stores, would be relatively competitive due to their widespread availability and low differentiation.
• Remote-controlled cars from one of two toy stores would fall somewhere in between but lean towards being relatively competitive, given there are still multiple sellers.
• Underwear, available from various department and specialty underwear stores, is also a relatively competitive product.
• Baseball hats for obscure nonlocal teams from 'uniquelids' would be less competitive due to their specialized nature and limited selling points.
• Movie tickets at the only theater in the mall are less competitive as there are no other competitors within the mall.