Question

When the U.S. government passed the Orphan Drug Act in 1983, innovation in that sector rapidly. This is an example of because drug companies responded to a. decreased; adverse selection; price distortion b. increased; moral hazard; tax incentives C. increased; induced innovation; tax incentives d. decreased; moral hazard; price distortion

Answer 1

The U.S. government passing the Orphan Drug Act in 1983 led to increased innovation in that sector because drug companies responded to tax incentives.

Step-by-step explanation:

The U.S. government passing the Orphan Drug Act in 1983 led to increased innovation in that sector. This is an example of induced innovation because drug companies responded to tax incentives.