Subsidies are more efficient than tariffs because they better
A) target tariff barriers by foreign producers.
B) target higher long term foreign producers' costs.
C) lower higher short term domestic producers' costs.
D) raise higher short term domestic producers' costs.
E) lower consumer welfare benefits.

Question

Quizplus · Accepted Answer

Subsidies can directly lower the costs for domestic producers in the short term, making them more competitive without necessarily affecting the price paid by consumers, unlike tariffs which can increase the cost of imported goods.

Subsidies Are More Efficient Than Tariffs Because They Better