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Budgeting for R&D


Read the article Tough Times Spur Shifts in Corporate R&D Spending and then have a go at the questions below. You can either read the article in the window below, or follow the previous link to open the article in a new window.

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Question 1

Define the term 'Research and Development' (R&D).

Question 2

Explain why firms may reduce their R&D budgets in a recession.

Question 3

Examine the reasons why '... 232 companies in the Standard & Poor's 500 index for which data were available increased their aggregate research and development expenditures to $163.37 billion in 2008 and $166.42 billion in 2009 from $154.44 billion in 2007'.

Question 4

Discuss the reasons why large pharmaceutical companies such as GSK and Pfizer are cutting their R&D budgets.