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Many State Governments Support Higher Education Through Subsidies

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Many state governments support higher education through subsidies.(A subsidy is like a negative excise tax).Consider the following supply and demand for college education at State U, which shows the equilibrium that would prevail without subsidies: annual tuition is $20,000 with Q0 enrolled students.Suppose the state provides a $10,000 per year subsidy paid to State U for each student enrolled.What impact will this subsidy have on the equilibrium tuition level and number of enrolled students? Explain. Many state governments support higher education through subsidies.(A subsidy is like a negative excise tax).Consider the following supply and demand for college education at State U, which shows the equilibrium that would prevail without subsidies: annual tuition is $20,000 with Q<sub>0</sub> enrolled students.Suppose the state provides a $10,000 per year subsidy paid to State U for each student enrolled.What impact will this subsidy have on the equilibrium tuition level and number of enrolled students? Explain.


Definitions:

Persuasive Conditioning

The use of classical conditioning techniques to alter attitudes or behaviors by associating a stimulus with positive or negative feelings.

Manipulative Conditioning

Refers to using operant conditioning techniques to manipulate behavior by controlling rewards and punishments.

Preferential Conditioning

A process in learning where an organism develops a preference or aversion to a stimulus based on its associated consequences.

Conditioned Compensatory Responses

Refers to the physiological and behavioral changes that occur as a reaction to anticipatory cues for a primary unconditioned stimulus, often seen in drug tolerance and addiction studies.

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