Which of the following statements is true?
A)If new firms are struggling to obtain funds from underdeveloped financial markets, the most efficient policy solution would be to offer a production subsidy to these firms.
B)If the government's goal is to induce early production even when the new firms are not cost-competitive by world standards, a barrier to the import of a substitute of the product produced by these firms would be an ideal policy.
C)If young firms are struggling to retain their trained workers, then government should offer a subsidy to offset the costs of training workers.
D)If the domestic firms do not supply anything at the world price, the government should lower the import barriers to boost domestic production.

Question

Quizplus · Accepted Answer

Offering a subsidy to offset the costs of training workers would be an efficient policy solution to retain trained workers for young firms. The other options do not address the issue appropriately or could potentially create market distortions.

Which of the Following Statements Is True