A Subsidy on a Product Will Generate More Actual Benefit

question 2

Multiple Choice

A subsidy on a product will generate more actual benefit for consumers (and less for producers) when

• A) the supply of the product is relatively inelastic.
• B) the supply of the product is relatively elastic.
• C) the demand for the product is relatively elastic.
• D) either a or c is true.

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Definitions:

Sold

A term indicating that an item, asset, or property has been transferred from one party to another in exchange for money or other compensation.

Defaults

Situations where a party fails to fulfill their obligations as specified in a contract or agreement.

Construction Lien

A claim made against a property by a contractor or subcontractor who has not been paid for work performed or materials supplied.

Building Contract

A legally binding agreement between a property owner and a contractor for the construction or renovation of a building, detailing the work to be done, materials, costs, and timeframes.