As It Relates to R&D, a Firm's Expected-Rate-Of-Return-Curve, R

Multiple Choice

As it relates to R&D, a firm's expected-rate-of-return-curve, r,

A) slopes downward because the firm arrays, highest to lowest, the rates of return on R&D activities.
B) slopes upward because of the law of diminishing returns.
C) is a horizontal line.
D) depends on whether it borrows from the bank or uses retained earnings in financing R&D.