Which of the Following Statements BEST Describes the Effects of Subsidies

question 48

Multiple Choice

Which of the following statements BEST describes the effects of subsidies?

• A) A subsidy essentially lowers the prices of foreign goods rather than raising the prices of domestic goods.
• B) A subsidy essentially raises the prices of domestic goods rather than lowering the prices of foreign goods.
• C) A subsidy essentially lowers the prices of domestic goods rather than raising the prices of foreign goods.
• D) A subsidy essentially raises the prices of foreign goods while also raising the prices of domestic goods.
• E) A subsidy essentially lowers the prices of foreign goods while also lowering the prices of domestic goods.

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Definitions:

Necessary Condition

A condition that must be present for an event to occur, but alone may not be sufficient to cause the event.

Breathing

The process of inhaling and exhaling air, facilitating the exchange of gases (oxygen and carbon dioxide) in the respiratory system.

Dead

A state of biological cessation where an organism no longer exhibits any signs of life or metabolic activity.

Necessary Condition

A condition that must be present for an event or entity to occur or exist.