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

question 144

Multiple Choice

Use the figure below to answer the following question(s) .
Figure 4-13

-Refer to Figure 4-13.The supply curve S and the demand curve D₁ indicate initial conditions in the market for flu shots.A new government program is implemented that grants buyers a $25 subsidy when they buy a flu shot,shifting the demand curve from D₁ to D₂.Which of the following is true for this subsidy given the information provided in the figure?

• A)The original price of a flu shot was $75,and after the subsidy,it rises to $90.
• B)$65 represents the net price a buyer must pay for a flu shot after taking into account the subsidy payment.
• C)Buyers of flu shots will receive an actual benefit of $10 from the subsidy,while sellers of flu shots will receive an actual benefit of $15 from the subsidy.
• D)All of the above are true.

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Definitions:

Translation Gain

Translation gain arises when the exchange rate changes favorably while converting foreign currency transactions or financial statements into the reporting currency.

Exchange Rate

The price of one country's currency in terms of another currency, affecting international trade and finance transactions.

Cash Flows

refers to the in and out movement of cash and cash equivalents within a business.