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Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364

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BuyFindarrow_forward

Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364
Textbook Problem

Why might private markets tend to provide too few incentives for the development of new technology?

To determine

The reason for providing few incentives for the development of new technology by the private markets is to be determined.

Explanation

The companies in the industry i.e. private markets incur cost as investment in the innovation of new technology for the betterment of their product and quality and for the satisfaction of the consumers need. By this, these companies expect a increase in their profits after covering the investment cost.

But due to more competitors and companies in the industry, on the arrival of the new technology those companies take the benefit of that i...

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