ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -This type of subsidy is provided in order to encourage the production of a product. In order for manufacturers to increase their production output, the government compensates for some of its parts in order to lessen their expenses while increasing their output.

Detailed explanation-2: -Subsidies are payments, tax breaks, or other forms of economic support given by governments to certain industries or economic sectors. The goal of subsidies is to aid or support what are deemed to be key parts of the economy or national infrastructure.

Detailed explanation-3: -If the government decides to subsidize the production of a good, the result would be a decrease in the equilibrium price and a decrease in the equilibrium quantity of the good.

Detailed explanation-4: -transitive verb. : to furnish with a subsidy: such as. : to purchase the assistance of by payment of a subsidy. : to aid or promote (someone or something, such as a private enterprise) with public money.

Detailed explanation-5: -A seller receives a subsidy to reduce the price for consumers.