if-demand-is-inelastic-and-supply-is-elastic-how-is-the-subsidy-benefit-divided

Question

If demand is inelastic and supply is elastic, how is the subsidy benefit divided?

Accepted Answer

Consumers receive a larger share of the subsidy benefit

Answer

The subsidy benefit is equally divided

Answer

Producers receive a larger share of the subsidy benefit

Answer

The subsidy benefit is negligible for both parties