In a market economy, the need to recover the up-front costs of innovation means that perfect...
In a market economy, the need to recover the up-front costs of innovation means that perfect competition:
is necessary for innovation to occur.
stimulates innovation.
is not compatible with innovation.
increases profits that fund innovation.
Homework Answers
Answer
Option 3
is not compatible with innovation
The market has no incentive to innovate as the market is free for anyone and the innovator is not going to get any extra benefits so it is not compatible with innovation
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