A subsidy is
(i) a negative tax.
(ii) a tax rebate given to those who make a specific choice.
(iii) a payment made by the government to those who make a specific choice.
A)(i), (ii), and (iii)
B)(i) and (iii)
C)(ii) and (iii)
D)(i) only

Question

Quizplus · Accepted Answer

A subsidy can be considered a negative tax because it effectively reduces the cost of a good or service, and it is a payment made by the government to encourage specific choices or behaviors.

A Subsidy Is (I) a Negative Tax