A subsidy is a:
A) reverse tax.
B) means of shifting the supply curve left.
C) form of tax increase.
D) movement along the supply curve.

Question

Quizplus · Accepted Answer

A subsidy is a payment made by the government to producers to help lower the cost of production or to incentivize production of a certain good or service. It is essentially a reverse tax because instead of taking money from producers, the government is giving them money to support their activities.

A Subsidy Is A