For the past two years, a cellphone manufacturer has been se…

For the past two years, a cellphone manufacturer has been selling to a group of distributors, who then sell the products to retailers to sell to the general public. The firm has now informed its distributors that each of them must sell the cellphones for a minimum price the manufacturer has set. In these circumstances,

Three inmates, all African Americans, have felt segregated f…

Three inmates, all African Americans, have felt segregated from the rest of the prison and have felt that their privileges for recreation, meals, and religious practices have been ignored. The prison in which the three men in question have been housed for years has been allowed to operate under a policy that allows prison administration a free hand in running the institution even if it violates the inmate’s rights. This is called

A large airline provides most of the flights between two par…

A large airline provides most of the flights between two particular cities. A new, small start-up airline decides to offer service between these two cities. The large airline immediately slashes prices on this route to the bone, so that the new entrant cannot make any money. After the new entrant has gone out of business, the incumbent firm raises prices again.  We would call the behavior of the large airline…

Paddy and Mick are the only two inhabitants of a small islan…

Paddy and Mick are the only two inhabitants of a small island off the coast of Ireland. They burn coal to keep their houses warm at night. However, this coal burning is harming the air quality on their island. Both Paddy and Mick could install air filters on their chimneys. These filters cost 50 each. Each filter provides a social benefit of 80, but those benefits are divided equally among Paddy and Mick. If both Paddy and Mick install the filters