Asked by
Zaige Perry
on Nov 26, 2024
Verified
In the inverted-U theory of R&D, which of the following industry concentration ratios would be most conducive to R&D (as a percentage of firm sales) ?
A) 1 percent
B) 10 percent
C) 50 percent
D) 70 percent
Inverted-U Theory
A hypothesis suggesting that a variable can produce effects that increase to a point after which further increases in the variable lead to a decline in the effect.
Industry Concentration Ratios
Statistical measures that express the extent to which a small number of firms dominate the total output, sales, or capacity in an industry.
R&D
Research and Development; a dedicated business or policy activity aimed at investing in new knowledge, product development, and innovation improvement.
- Acquire knowledge on how the inverted-U theory correlates R&D spending with the level of industry concentration.
Verified Answer
FI
Learning Objectives
- Acquire knowledge on how the inverted-U theory correlates R&D spending with the level of industry concentration.