A government is considering two policies of equal cost to accelerate electric vehicle (EV) adoption. Policy X provides a large, one-time grant for R&D to permanently lower EV battery manufacturing costs. Policy Y offers a temporary, direct-to-consumer cash rebate for new EV purchases that expires after one year. Which policy is more likely to cause a lasting upward shift of the entire Adoption Dynamics Curve (ADC), and what is the correct reasoning?
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A government is considering two policies of equal cost to accelerate electric vehicle (EV) adoption. Policy X provides a large, one-time grant for R&D to permanently lower EV battery manufacturing costs. Policy Y offers a temporary, direct-to-consumer cash rebate for new EV purchases that expires after one year. Which policy is more likely to cause a lasting upward shift of the entire Adoption Dynamics Curve (ADC), and what is the correct reasoning?
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