When a government subsidy is granted to the buyers of a product, sellers can end up capturing some of the benefit because
a. the market price of the product will fall in response to the subsidy.
b. the market price of the product will rise in response to the subsidy.
c. the market price of the product will not change in response to the subsidy.
d. producers will reduce the supply of the product.
B
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In the run up to the war in Iraq that began in 2003, one of the many concerns raised was that a war could result in a decrease in the supply of oil. At the same time, the U.S
economy was having a hard time recovering from the recession of 2001 and, as a result, incomes of many consumers had decreased (due to layoffs, wage cuts, and so forth). All else constant, it was reasonable to predict, with certainty, that the combination of these two factors would cause the equilibrium: A) quantity of oil to decrease. B) quantity of oil to increase. C) price of oil to increase. D) price of oil to decrease.
Critics of an equal distribution of income argue that the effect would be to raise the incentive to be productive
a. True b. False Indicate whether the statement is true or false
Since 1946, the president of the United States has received guidance from the Council of Economic Advisers
a. True b. False Indicate whether the statement is true or false
An economy operating inefficiently is graphed as a point ______ the production possibilities curve.
a. above
b. inside
c. outside
d. on