From the list below, the best definition of the word 'subsidy' is

Question

BlackTom AI · Accepted Answer

A subsidy is a payment from the government to an individual or firm designed to encourage or support a particular activity or reduce the cost of producing or consuming a good or service.

1) Relevant concepts:
- Subsidy: government payment to lower costs or incentivize behavior (e.g., agriculture supports, renewable energy grants).
- Levy/tax: compulsory charge imposed to discourage or raise revenue.
- Opportunity cost: the value of the next-best alternative forgone when making a decision.
- Substitute good: a product that can replace another in consumption.

2) Step-by-step reasoning:
- Read option (a): it states a payment provided by the government to a person or firm to encourage a particular behaviour. This matches the standard economic definition of a subsidy.
- Read option (b): describes a levy imposed by the government to discourage behaviour — that is the definition of a tax or fine, the opposite of a subsidy.
- Read option (c): defines opportunity cost — unrelated to government payments and a distinct economic concept.
- Read option (d): defines a substitute good — a type of product relation, not a government payment.

3) Intermediate conceptual steps:
- Identify if the option mentions government payment vs government charge. Subsidies are payments (transfer from government to recipient), not charges.
- Identify the intended effect: encourage/support vs discourage/deter. Subsidies encourage.

4) Why (a) is correct:
- It explicitly describes a government payment aimed at encouraging behaviour, exactly matching textbook definitions (e.g., production subsidy, consumption subsidy, grants).

5) Why other options are incorrect:
- (b) describes a levy/tax used to discourage behavior — this is the opposite policy instrument.
- (c) describes opportunity cost — a decision-making concept, not a government transfer.
- (d) describes a substitute product — a market relation, not a fiscal policy.

Conclusion: Option a is the correct definition of "subsidy," which matches the provided answer (a).

From the list below, the best definition of the word 'subsidy' is单项选择题

类似问题