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Explain in economic terms the difference between rent-seeking
and profit-seeking

User Unnati
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Final answer:

Rent-seeking refers to obtaining economic benefits through political means, while profit-seeking involves market competition and creating value for consumers.

Step-by-step explanation:

Rent-seeking refers to the pursuit of economic gain through political means, such as lobbying for government favors or regulations that benefit a specific group or industry. In this case, individuals or firms seek to obtain economic benefits at the expense of others, without creating any additional value in the economy.

Profit-seeking, on the other hand, involves the pursuit of economic gain through market competition and providing goods or services that consumers value. This is the basis of a market economy, where firms strive to maximize their profits by offering products that are more attractive or efficient than their competitors.

Overall, rent-seeking focuses on using political influence to gain economic advantages, while profit-seeking revolves around creating value and competing in the marketplace.

User Bazooka
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