Multiple Choice
Which of the following is a true statement regarding the economic impact of a subsidy?
A) The distribution of the benefits from a subsidy will depend on whether the subsidy is legally granted to the buyer or seller.
B) When demand is relatively inelastic, the benefits of a subsidy will mainly accrue to sellers.
C) When supply is relatively elastic, the benefits of a subsidy will mainly accrue to buyers.
D) When demand is relatively elastic, the benefits of a subsidy will mainly accrue to buyers.
Correct Answer:
Verified
Correct Answer:
Verified
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