Multiple Choice
Why would knowledge capital exhibit increasing returns for an entire economy, but not for an individual firm?
A) Its non-rival nature means small gains in productivity can be enjoyed by thousands of firms at once.
B) Its non-rival nature means that firms must compete to enjoy the benefits fo knowledge capital.
C) Its non-excludable nature means that firms have an extra incentive to produce knowledge capital.
D) Its non-excludable nature means that use by one firm does not reduce the benefit of knowledge capital to another.
E) Its non-excludable nature means that small gains in productivity cannot be captured by just one firm.
Correct Answer:

Verified
Correct Answer:
Verified
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