Which of the following is an example of rent seeking behavior?
A)Apple earned large profits from the development and sale of the iPhone.
B)Amazon introduced the Kindle to compete with Sony's Digital Reader. Amazon was motivated by the desire to earn profits from the Kindle but also increased the choice of digital music players available to consumers.
C)U.S. sugar firms convinced Congress to impose a quota on imports of sugar.
D)Recent increases in cigarette taxes faced little opposition from voters, many of whom were rationally ignorant with respect to the tax.

Question

Quizplus · Accepted Answer

U.S. sugar firms convinced Congress to impose a quota on imports of sugar. This is an example of rent seeking behavior because it involves firms trying to use government intervention to limit competition and increase their profits, rather than through market competition.

Which of the Following Is an Example of Rent Seeking