FirstCorp has an office coffee pot for employees.Though anyone may partake of the coffee,there is a sign above the machine that reads,"Please pay your fair share! A contribution of 25¢ per mug is suggested." After a few weeks,the office manager realizes that 200 cups of coffee have been taken,but only 100 quarters are in the jar.FirstCorp is experiencing

Question

Quizplus · Accepted Answer

FirstCorp is experiencing a free-rider problem where individuals are benefitting from the coffee without contributing their fair share. This is evidenced by the fact that 200 cups of coffee have been taken, but only 100 quarters are in the jar. The sign suggesting a contribution is not enough to incentivize all individuals to act in a socially responsible manner.

FirstCorp Has an Office Coffee Pot for Employees