Short Answer

Evaluating Technology Adoption Policies

A government is considering two policies to encourage the public to switch to electric vehicles (EVs). Policy A offers a very large cash rebate, but only to the first 10,000 people who purchase an EV. Policy B offers a smaller, but universally available, tax credit to every person who purchases an EV, with no limit on the number of recipients. Which policy is more likely to be effective at achieving widespread, long-term adoption of EVs across the entire market, and why? Explain your reasoning in terms of influencing consumer decisions at all stages of market growth.

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Updated 2025-10-03

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