One common assumption in economics is that the products of different firms in the same industry are indistinguishable. For each of the following industries, discuss whether this is a reasonable assumption.
- fast food
- I would think that one bar of steel is pretty much like any other bar of steel, so this assumption would be true in the case of the steel industry. The one wrench to throw into this is that the U.S. Patent and Trademark Office these days allows all sorts of obvious
inventionsto be patented. So a slight variation on a common process might be patented allowing differences in product to persist. However, even with that, i can't imagine that there is much difference in steel for most common uses. Perhaps in some specialized fields.
- Even Star Trek® novels are easily distinguishable from each other, in wording if not in plot and interest.
- Wheat is a commodity. One bushel of wheat is indistinguishable from another.
- fast food
- The premise of fast food is that a Big Mac® is the same wherever you go in the U.S. Now, another brand's burger is going to have some differences, but they will be minor. The primary difference is in the branding, not the burgers themselves. Still fast food is more unique than wheat is.