New growth suggests that the accumulation of knowledge capital can be slowed because knowledge is both nonrival and nonexcludable. how does the federal government intervene in the market to increase the amount of knowledge capital? a. patents b. subsidies c. public education d. all of the above e. a and b only

Knowledge can be defined as a public good, since it is both nonrival and nonexcludable. Everyone is entitled to increase their personal knowledge, and that also applies to businesses.

By issuing patents the government restrains the use of new technologies that temporarily belong to a person or a company. This is done to protect investment in research and development.

Subsidies are handed out by government entities to promote research on several areas including health, new technologies, environmental protection, etc.

Public education is crucial once you understand that knowledge is also public, ideas don't belong to just one person, and the government has the responsibility of educating the population. The more educated the nation's population is, the more it can develop new technologies.

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