Question 2: Patents Suppose an investment of S100,000 in research yields a pioneering invention that has no commercial value, and a subsequent investment of $50,000 in development that yields an improvement that has a commercial value of S1 million. Assume that Firm A is uniquely situated to do the pioneering research, and Firm B is uniquely situated to develop the application. Predict the difference in investment resulting from a broad patent law and a narrow patent law. In making your prediction, distinguish between a situation in which transaction costs prevent Firm A and Firm B from bargaining with each other and a situation in which transaction costs of bargaining are zero