After you have studied Economics in the News on pp. 388-389, answer the following questions.

a. What are some of the benefits of research efforts aimed at finding a COVID-19 vaccine?

b. What are some of the costs of research efforts aimed at finding a COVID-19 vaccine?

c. What determines the efficient amount of research efforts? What might lead to under- provision or overprovision of research?

d. Draw a graph to illustrate the possible out- come of overprovision of research efforts aimed at finding a COVID-19 vaccine.

e. In epidemiology, the basic reproduction number of an infection is the expected number of cases directly generated by one case of the infection. How would you expect the basic reproduction number of an infection to influence the marginal social benefit of research efforts aimed at finding a vaccine against the infection? 26. Trump Administration to Cut Its Financial Contribution to NATO The United States will cut its contribution to NATO's budget as other NATO members fall behind on their committed contributions. Source: cnn.com, November 28, 2019

a. Explain the free-rider problem described in this news clip.

b. Does the free-rider problem in international defence mean that the world has too little defence against aggression?

c. How do nations try to overcome the free-rider problem among nations?