An analyst on a local news channel argues that the recent corporate scandals "demonstrated very clearly that self interest always contradicts social interest." Do you agree or disagree? Substantiate your answer
What will be an ideal response?
You should disagree. The recent corporate scandals only show that self interest might contradict social interest. But they don't prove that this is necessarily the case as we can find many real-world examples of how people guided by self-interest promote society's well-being. In fact, under the market system the whole economy operates through the decisions made by self-interested individuals. And countries such as the United States have proven to be more successful in promoting social interest than were centrally planned, or communist, economies where people's self interest was suppressed and all important economic decisions were made by government.
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In the economic way of thinking, an example of "capital" might include
A) literacy. B) natural resources. C) knowledge. D) stable rules of the game. E) all of the above.
A typical firm in a cartel will hold which of the following attitudes?
A) If everyone cheats, I'm better off, and so is everyone in the cartel. B) If I alone cheat, I'm better off; if everyone cheats, I'm worse off. C) I can never do better for myself than following agreed-upon cartel rules. D) If I suspect others are planning to cheat, I'll do best for myself by deciding not to cheat.