Which of the Following Supports the Contention That Pure Competitors

question 37

Multiple Choice

Which of the following supports the contention that pure competitors have a strong incentive to engage in R&D?

• A) Entry to purely competitive industries is easy and thus profit from innovation is quickly competed away.
• B) Pure competitors cannot risk being complacent about innovation because a new product,production technique,or distribution method could undermine their normal profit and drive them out of the market.
• C) Most purely competitive industries are increasing-cost industries.
• D) Pure competitors are happy to earn only a normal profit.

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Definitions:

True Endocrine Gland

A gland that secretes hormones directly into the bloodstream to regulate various bodily functions, without using a duct.

Hypothalamus

A region of the brain below the thalamus; it coordinates both autonomic nervous system and the activity of the pituitary, controlling body temperature, thirst, hunger, and other homeostatic systems.

Stained Cells

Cells that have been treated with specific dyes to highlight particular components under a microscope.

Posterior Lobe

The back part of an organ or gland, such as the posterior lobe of the pituitary gland in the brain.