A Subsidy

question 112

Multiple Choice

A subsidy:

• A) has the same impact on a market as a tax.
• B) has a larger impact on a market than a tax of the same amount.
• C) has a smaller impact on a market than a tax of the same amount.
• D) is the reverse of a tax.

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Definitions:

Behavioral Economists

Economists who study the effects of psychological, cognitive, emotional, cultural, and social factors on the economic decisions of individuals and institutions.

Systematic Errors

Errors that are consistent and repeatable, often due to flaws in the measurement system or experiment design, affecting the accuracy of results.

Stable Preferences

The assumption in economic theory that consumers' tastes, preferences, and choices remain constant over time.

Behavioral Economics

A field of economics that examines how psychological, cognitive, emotional, cultural, and social factors affect economic decisions of individuals and institutions.