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answer both questions plz 12. Explain the aggregation effect and the team diversity effect in the context of shared information goods. What is the implication
answer both questions plz
12. Explain the aggregation effect and the team diversity effect in the context of shared information goods. What is the implication of a market where the team diversity effect dominates the aggregation effect? 13. The table below shows the payoff matrix in a game in which two firms must choose whether or not to innovate and enter a market. Both firms costlessly hold a share in the patent associated with any innovation that takes place (regardless of whether or not they create that innovation). If both enter and innovate they each earn a payoff of r-c where r is a firm's revenues and c are the firm's costs of entry. If neither enters/innovates, each firm receives a zero payoff. In the event that one firm enters/innovates and the other does not, the firm who enters receives a high revenue payoff R>r but must pay a portion of these revenues () to the other firm in addition to entry costs. Firm 2 Enter/innovate Don't enter/innovate Enter/Innovate -C,- (1-OR-C, OR Firm 1 Don't enter/innovate OR, (1-OR-C 0,0 a) Under what circumstances will the existence of the patent in this game result in no innovation taking place? b) Under what circumstances does a patent system have no impact on firms' decisions to innovateStep by Step Solution
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