What is the welfare impact of a subsidy policy?
A) Producer surplus increases, consumer surplus declines, and total welfare declines.
B) Producer and consumer surplus increase, and these gains are larger than the government cost.
C) Producer and consumer surplus increase, and these gains are smaller than the government cost.
D) Producer surplus increases, consumer surplus declines, and total welfare increases due to the subsidy program.
C
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In a simplified system where all banks have uniform reserve requirements and checkable deposits are the only form of money, the money multiplier is equal to 1 over the required reserve ratio
a. True b. False Indicate whether the statement is true or false
Which of the following is not part of the Federal Reserve System?
a. Treasury Department b. District Federal Reserve Banks c. Federal Open Market Committee d. Branches of District Federal Reserve Banks e. Board of Governors