If a Firm's Efforts to Be Technologically Innovative Will Create

question 65

Multiple Choice

If a firm's efforts to be technologically innovative will create a positive externality, then that firm will likely

• A) have more incentive to innovate to the extent that the whole of society desires.
• B) invest significantly more in its research and development activities.
• C) have less incentive to innovate to the extent that the whole of society desires.
• D) demand more financial capital investment to expand its R&D activities.

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Definitions:

Single-Price Monopoly

A monopolistic market structure where the monopolist charges the same price for every unit of the product sold to every consumer.

Economically Inefficient

A situation where resources are not used in the most productive way, leading to wasted potential output or outcomes.

Profit-Maximizing Output

The level of production at which a business achieves the highest possible profit, where marginal cost equals marginal revenue.