Producers of computer software are plagued with the problem of "pirating", that is, many people copy software legally purchased by others. The industry estimates that for each legal copy of a program, there are two pirated copies in use. The industry wants strict laws for the enforcement of its "intellectual property rights," but enforcement is obviously very difficult. Economists call this
problem
a. depletability.
b. externality.
c. durability.
d. nonexcludability.
d
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Rent seeking is best defined as attempts
A) by landlords to get tenants. B) to achieve monopoly power and the resulting economic profit. C) by individuals to avoid paying taxes. D) by owners of a monopoly to sell the firm.
Which of the following is a behavioral implication of bounded rationality?
A) unbounded selfishness B) a rule of thumb C) a rational mistake D) a nervous breakdown
Unplanned inventory reduction causes firms to:
a. produce less output. b. lower prices on the products it sells. c. change its promotional strategies. d. produce more output.
How can paying workers an above-market wage result in greater efficiency? What are the implications for the flexibility of wages?
What will be an ideal response?