The presence of creates a difference in the value between the market price and the factor cost of a product.

Question

Quizplus · Accepted Answer

Indirect taxes increase the market price of a product, while subsidies decrease the factor cost of production. Therefore, the presence of both indirect taxes and subsidies creates a difference between the market price and factor cost. The other options do not involve both a factor cost and a market price.

The Presence of Creates a Difference in the Value Between