If the government wants to encourage the consumption of a particular good, they should enact:
A. a subsidy to buyers, since they deserve the benefit more than the producers.
B. a subsidy on either buyers or sellers, since they will both have the same effect on the market.
C. a subsidy to buyers, since they want to affect consumption of the good.
D. a subsidy to sellers, since they want more to be produced and offered for sale.
Answer: B
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Refer to Table 14-3. Which of the following statements is true?
A) The Nash equilibrium is a noncooperative, dominant strategy equilibrium. B) The Nash equilibrium is a cooperative equilibrium. C) There is no Nash equilibrium in this game because each party pursues its dominant strategy. D) The Nash equilibrium is a collusive equilibrium.
The use of a price system eliminates: a. scarcity
b. equilibrium. c. shortages and surpluses. d. changes in supply and demand.