FTihgeu Grera:p Hho Smhoew'ss Ethxep Oerffteinctg O If Nad Suusbtsriyd

question 115

Multiple Choice

FTihgeu grera:p Hho smhoew'ss Ethxep oerffteinctg o If nad suusbtsriyd yI Ion a large country. (Figure: Home's Exporting Industry II) According to the
Graph, what is the deadweight loss due to the subsidy?

• A)$12,500
• B)$625
• C)$1,250
• D)$5,000

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Definitions:

Punish

the act of imposing a penalty on someone as retribution for an offense.

Resale Agreement

An agreement between parties where the seller agrees to sell an asset or product with the understanding that the buyer intends to sell it again to a third party.

Unconscionable

A term used to describe actions or conditions that shock the conscience or are exceedingly unfair or unjust.

Obligated to Resell

The requirement to sell an item or property again, often under specific conditions or regulations.