Consider a perfectly competitive market with inverse market supply P = 5 + 3QS and inverse market demand P = 50 - 2Qd. Suppose the government subsidizes this market with a subsidy of $5 per unit. What is the impact on the government's budget resulting from the subsidy? O-300 -270 -45 -50

Consider a perfectly competitive market with inverse market supply P = 5 + 3QS and inverse market demand P = 50 - 2Qd. Suppose the government subsidizes this market with a subsidy of $5 per unit. What is the impact on the government's budget resulting from the subsidy? O-300 -270 -45 -50

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Consider a perfectly competitive market with
inverse market supply P = 5 + 3Q⁹ and
inverse market demand P = 50 - 2Qd
Suppose the government subsidizes this market
with a subsidy of $5 per unit. What is the
impact on the government's budget resulting
from the subsidy?
O-300
O-270
-45
O-50

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