Two Students Are Given a Project to Work on Together

question 239

Multiple Choice

Two students are given a project to work on together. Each student could either work or shirk. There is no individual accountability; each student receives the same grade regardless of how much work he or she contributes. One student is a weak student who prefers partying and the other is a serious student who prefers working hard. How can the teacher adjust the incentive scheme to ensure equal effort by both students?

• A) Ask each student to evaluate the other and use that assessment in grading the project.
• B) Ask the more serious student to put in as much effort as possible.
• C) Ask the weaker student to put in as much effort as possible.
• D) Leave the incentive scheme as is-the students will automatically put in equal effort.

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Definitions:

Profit

The financial gain made in a transaction or operation, calculated as total revenues minus total costs.

Cartel

A group of independent market participants who collude to raise prices, limit supply or otherwise manipulate market conditions in their favor.

Quantity Effect

the change in the quantity of goods sold or consumed as a result of a change in price, holding other factors constant.

Profit

The financial gain or surplus remaining after all operating expenses, taxes, and costs have been subtracted from total revenue.