Suppose the government grants a subsidy to domestic producers of an import-competing good. The subsidy tends to result in deadweight losses for the domestic economy in the form of the:
A. Consumption effect
B. Redistribution effect
C. Revenue effect
D. Protective effect
Answer:B
Suppose the government grants a subsidy to domestic producers of an import-competing good. The subsidy tends to result in deadweight losses for the domestic economy in the form of the:
A. Consumption effect B. Redistribution effect C. Revenue effect D. Protective effect