Which of the Following Statements Is NOT True Regarding Subsidies

question 28

Multiple Choice

Which of the following statements is NOT true regarding subsidies?

• A) Similar to a tax, a subsidy also creates a deadweight loss.
• B) The main beneficiary of a subsidy is the party that directly receives the check from the government.
• C) Subsidies create inefficient increases in trade.
• D) When a subsidy is present, the price received by sellers exceeds the price paid by buyers.

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Definitions:

Suit

A legal action taken by one party against another in a court of law.

Lakefront Property

Real estate located directly on the edge of a lake, often highly valued for its scenic views and access to water-based activities.

Specific Performance

A legal remedy requiring a party to perform a specific act, typically fulfilling a contract.

Fail to Close

A situation where a transaction or deal does not complete by the specified or agreed upon time.