Suppose a Small Island Nation Imports Sugar for Its Population

question 93

Multiple Choice

Suppose a small island nation imports sugar for its population at the world price of $1,500 per ton. The domestic market for sugar is shown below. If the government provides a subsidy of $500 per ton, then the cost of subsidy, which must be borne by taxpayers, will be ______ per day.

• A)$500
• B)$2,000
• C)$5,000
• D)$6,000

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