Suppose that the world price of sugar is $100 per ton.If a
Large country gives its sugar exporters a subsidy of $50 per
Ton, then domestic consumption of sugar will:
A)fall.
B)rise.
C)remain unchanged.
D)first fall, then rise.

Question

Quizplus · Accepted Answer

A subsidy to sugar exporters will likely increase the price of sugar domestically, as more sugar is exported due to the subsidy, reducing the supply available for domestic consumption. This typically leads to a decrease in domestic consumption.

Suppose That the World Price of Sugar Is $100 Per