Economists who contend that oligopolists have a strong incentive to engage in R&D say that
A)the undistributed profits of oligopolists give them a source of readily available, relatively low-cost funds for financing R&D.
B)entry barriers enable oligopolists to sustain the profit they gain from innovation.
C)the large size of oligopolists' R&D departments allows them to use specialized, expensive R&D equipment and employ teams of specialized researchers.
D)all of the other answers are true.

Question

Quizplus · Accepted Answer

All the provided reasons (A, B, and C) are arguments economists make to support the idea that oligopolists have a strong incentive to engage in research and development (R&D). These factors contribute to the ability and motivation of oligopolistic firms to innovate.

Economists Who Contend That Oligopolists Have a Strong Incentive to Engage