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If the supply of a good is elastic, then a subsidy on that good will likely lead to a relatively large decrease in the quantity
If the supply of a good is elastic, then a subsidy on that good will likely lead to a relatively large decrease in the quantity supplied. This is because producers are not responsive to changes in price when supply is elastic. Question 16Answer a. True b. False
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Managerial Economics and Strategy
Authors: Jeffrey M. Perloff, James A. Brander
2nd edition
134167879, 134167872, 9780134168319 , 978-0134167879
