1. What are the major pros and cons of granting patent rights to inventors and c
ID: 1105727 • Letter: 1
Question
1. What are the major pros and cons of granting patent rights to inventors and companies?
Patents help to reduce product prices when the product first comes out, unfortunately, these lower prices are short-lived and often the price goes up substantially after the patent runs out.
Patents help to reduce monopolies in the United States, unfortunately, since they are temporary, this is a temporary fix.
Patents are uniformly good with not possible problems to be raised
Patents help to spur innovation, unfortunately, they result in higher prices for consumers in many cases
2. You are evaluating the possible merger of Honda and Philip Morris. What kind of merger is this?
Conglomerate
None of the above
Horizontal
Vertical
3,
The prisoner's dilemna gets it name from:
Prisoners of war who came back with various psychological issues and needed mental health benefits.
Auction theory and how it applies to private companies vying for a private prison contract with the government
Two prisoner's being questioned separately by police and asked to testify against one another.
The need parents feel to be altruistic to their child when he or she is the result of an unplanned pregnancy
Patents help to reduce product prices when the product first comes out, unfortunately, these lower prices are short-lived and often the price goes up substantially after the patent runs out.
Patents help to reduce monopolies in the United States, unfortunately, since they are temporary, this is a temporary fix.
Patents are uniformly good with not possible problems to be raised
Patents help to spur innovation, unfortunately, they result in higher prices for consumers in many cases
Explanation / Answer
(1) Option (D)
Patents encourage innovation by firms, but since no other company can replicate the product in question during patent period, the patent holder acts like a monopolist, charging higher price in most cases, compared to a competitive market pricing.
(2) Option (A)
Honda is an automobile firm and Philip Morris is a tobacco company, and the companies operate in completely unrelated sectors. A merger between them will be a conglomerate merger.
(3) Option (C)
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