The conjecture that R&D expenditures as a percentage of firms' sales first rise,reach a peak,and then fall as industry concentration rises is known as the:

A) inverted-U theory of R&D.
B) average product of R&D theory.
C) bell-shaped-curve theory of product innovation.
D) theory of increasing and diminishing returns.

Inverted-U Theory

A hypothesis suggesting that a relationship between two variables follows an upside-down U shape, often applied to the correlation between productivity and stress levels.

R&D Expenditures

Financial investments made by firms, governments, or institutions in research and development activities aimed at innovation, creating new products, or improving existing ones.

Industry Concentration

A measure of the extent to which a small number of firms dominate the total production, sales, or market share in an industry.