Patents stimulate investment
a. by giving inventors an incentive to incur up-front costs of developing new products
b. by giving tax breaks to inventors
c. by guaranteeing a profit from new products
d. by lowering interest rates
e. through government payments that cover costs of research and development
A
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Refer to above figure. If the economy were in the initial position (where OmL1 workers were in manufacturing, what trade policy might gain ABC of economic welfare?
What will be an ideal response?
As an economy adjusts to an increase in the saving rate, we would expect output per worker
A) to increase at a constant rate and continue increasing at that rate in the steady state. B) to increase at a permanently higher rate. C) to decrease at a permanently higher rate. D) to return to its original level. E) none of the above