13
QuizMultiple Choice

Trade and Development — Test

Question 13 • Economics and Personal Finance

Tariffs and subsidies are both types of

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

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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