In the above figure, if a Medicare subsidy that had previously been paid by the government has now been eliminated, the result will be

A. a decrease in the price paid by consumers, from Ps to P0.
B. an increase in the price paid by consumers, from P0 to Ps.
C. a decrease in the price received by producers, from Ps to P0.
D. an increase in the price received by producers, from P0 to Ps.


Answer: C

Economics

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