When a government subsidy is granted to the buyers of a product, sellers can end up capturing some of the benefit because
A) the market price of the product will fall in response to the subsidy.
B) the market price of the product will rise in response to the subsidy.
C) the market price of the product will not change in response to the subsidy.
D) producers will reduce the supply of the product.
Correct Answer:
Verified
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