20
QuizMultiple Choice

International Economics — Test

Question 20 • Personal Finance and Economics

Tariffs and subsidies are both types of

Answer
A
monetary restrictions for the domestic producer.
B
economic benefits for the consumer.
C
economic benefits for the international producer.
D
positive and negative incentives.

Explanation

A subsidy provides financial support that encourages a business or industry, so it acts as a positive incentive. A tariff raises the cost of imported goods, discouraging imports, so it acts as a negative incentive. Therefore, tariffs and subsidies are positive and negative incentives.

AI-written and checked against the verified answer.

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