Figure 3-3 -In Figure 3-3,the Lowest Price That Would Persuade Suppliers to Persuade

question 147

Multiple Choice

Figure 3-3
-In Figure 3-3,the lowest price that would persuade suppliers to offer quantity Q₂ for sale is

• A)P₂.
• B)P₁.
• C)P₀.
• D)not shown on the diagram.

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Definitions:

Subsidies

Subsidies are financial contributions provided by the government to encourage the production or consumption of a good or service, often to support industries that are considered vital for the national economy.

Incentives

Rewards or penalties that motivate individuals to take specific actions.

Sweden

A Scandinavian country known for its high standard of living, strong welfare state, and active role in international peace and security.

Market Failure

A situation in which the allocation of goods and services by a free market is not efficient, often justifying government intervention.