(Research and development) In 1974, the FASB issued its statement saying that expenditures on research and development would be considered expenses, not assets. There were many people who were concerned that by not allowing companies to recognize these expenditures as assets, the FASB would discourage companies from doing research. The concern was that this accounting rule would have real, adverse effects on the U.S. economy. Should the FASB consider such arguments when setting accounting rules? Explain.