Does a Subsidy to Sellers Affect the Demand Curve

question 47

Multiple Choice

Does a subsidy to sellers affect the demand curve?

• A) Yes, it shifts demand up by the amount of the subsidy.
• B) Yes, it shifts demand to the right by the amount of the subsidy.
• C) No, the quantity demanded will increase, but the demand curve does not move.
• D) No, the quantity demanded will decrease, but the demand curve does not move.

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Definitions:

Semi-Annual Interest

Interest that is calculated and paid twice a year, commonly found in bonds and certain types of loans.

Coupon Rate

Interest yielded on a bond each year, displayed as a percentage of its face value.

Market Rate Of Interest

The prevailing rate of interest available in the marketplace for securities of similar risk and maturity.

Semi-Annual Interest

Interest that is calculated and paid twice a year, typically used for bonds and loans.