Log out Go to App
Go to App

Learning Materials

Features

Discover

Chapter 13: Q.17 (page 316)

Can a company be guaranteed all of the social benefits of a new invention? Why or why not?

Short Answer

Expert verified

A company cannot be guaranteed all of the social benefits of a new invention.

Step by step solution

01

Step 1. Introduction:

Social benefits is the summation of private benefits gained by firms and positive externalities to a third party.

02

Step 2. Explanation:

When a company constructs a facility or purchases equipment, it reaps all of the economic rewards associated with the investment. When a company invests in modern technology, however, the private benefits, or profits, it obtains are only a small part of the total social benefits. A firm cannot be assured all of the societal advantages of new inventions because other enterprises in the same market profit from new inventions as well, because they can now produce technology more efficiently and don't have to pay for research and development.

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

Radio stations, tornado sirens, light houses, and street lights are all public goods in that all are non-rivalrous and non-exclusionary. Therefore why does the government provide tornado sirens, street lights and light houses but not radio stations (other than PBS stations)?

Why is a football game on ESPN a quasi- public good but a game on the NBC, CBS, or ABC is a public good?

Provide two examples of goods/services that are classified as private goods/services even though they are provided by a federal government.

How do public television stations, like PBS, try to overcome the free rider problem?

Is it inevitable that government must become involved in supporting investments in new technology?
See all solutions

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free