Is It Possible for Sellers to Benefit More Than Consumers

question 46

Multiple Choice

Is it possible for sellers to benefit more than consumers from a subsidy to buyers?

• A) Yes, if the sellers need it more.
• B) Yes, if the supply curve is relatively less elastic than the demand curve.
• C) Yes, if the supply curve is relatively more elastic than the demand curve.
• D) Producers can never benefit more than buyers from a subsidy to buyers.

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Definitions:

Equipment Rental

The process of leasing machinery or equipment for a specific period instead of purchasing it outright.

Markup Per Unit

The sum added to the purchase price of products to account for operational costs and earnings.

Variable Cost

Expenses that change in proportion to the activity of a business.

Desired Profit

The target profit a company sets to achieve in a specific period.