How does the cost of financial capital influence innovative research and development activities in a competitive market?
A. at a high cost, firms demand a large quantity, as R&D projects return high rates.
B. at a low cost, firms demand a large quantity, as R&D projects will likely return a higher rate.
C. financial capital at a high cost means more projects are likely to pay a much higher return rate.
D. at a low cost, the firm receives only small private benefits from investing in R&D.
Answer:B
How does the cost of financial capital influence innovative research and development activities in a competitive market?
A. at a high cost, firms demand a large quantity, as R&D projects return high rates. B. at a low cost, firms demand a large quantity, as R&D projects will likely return a higher rate. C. financial capital at a high cost means more projects are likely to pay a much higher return rate. D. at a low cost, the firm receives only small private benefits from investing in R&D.
Explanation: Type: Multiple Choice