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

question 289

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 exhibit?

• A)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.
• B)Buyers of flu shots will receive an actual benefit of $15 from the subsidy,while sellers of flu shots will receive an actual benefit of $10 from the subsidy.
• C)Buyers of flu shots will receive the full $25 benefit from the subsidy.
• D)Sellers of flu shots will receive the full $25 benefit from the subsidy.

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Definitions:

Expected Return

Expected return is the anticipated amount of profit or loss an investment is likely to generate over a specific period.

Company Cost

Expenses incurred by a business in the process of earning revenues, often categorized into fixed and variable costs.

Diversifiable Risk

Refers to the risk that can be reduced or eliminated in a portfolio through diversification, which involves investing in a variety of assets.

Nonsystematic Risk

The part of total risk that is specific to an individual asset or company, and can be reduced through diversification.