a) Under what circumstances will a drug company charge more for its drug after its patent expires?
b) Proposals to reduce patent length for drugs are sometimes made, but some critics argue that such a change would result in even higher prices during the patent period as companies would need to recover drug development costs more quickly. Is this argument valid if drug companies maximize profit?
Your answer will be assessed on how well you do in terms of;
- Problem solving: Apply theoretical understanding of microeconomic concept like consumer behaviour to real life economic problems
- Knowledge and understanding: Recognise how microeconomic analysis helps people, firms and governments in making choices in different scenarios
- Ethics: Demonstrate ability to evaluate economic theory and real world applications in the context of ethical considerations
- Communicate your ideas in written expressions and diagrams and provide a logical and cohesive answer