Use the Figure Below to Answer the Following Question(s)

question 220

Multiple Choice

Use the figure below to answer the following question(s) . Figure 4-13
Refer to Figure 4-13. The exhibit illustrates the impact of granting a subsidy on a particular good. Which of the following is true for this subsidy given the information provided in the exhibit?

• A) The subsidy has been statutorily (legally) paid to sellers.
• B) The subsidy results in a decrease in the market selling price of the good.
• C) Sellers will receive a larger proportion of the benefit from this subsidy than buyers.
• D) The subsidy results in a reduction in the quantity purchased.

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