GK
INDIAN ECONOMY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Subsidies do not allow prices to indicate the supply of a good. True/False?
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True
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False
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Either A or B
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None of the above
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Explanation:
Detailed explanation-1: -A subsidy is a payment made to firms or consumers designed to encourage an increase in output. A subsidy will shift the supply curve to the right and therefore lower the equilibrium price in a market.
Detailed explanation-2: -Subsidy is a payment that a. government makes to a producer to supplement the market price of a commodity.
There is 1 question to complete.