Which group directly benefits from subsidies in a market?

• A. Producers
• B. Importers
• C. Exporters
• D. Sellers

Answer: (A)

Verified step by step guidance

1. Understand the concept of a subsidy: A subsidy is a financial assistance provided by the government to reduce the cost of production or encourage the supply of a good or service.
2. Identify the recipients of subsidies: Subsidies are typically given to producers or sellers to lower their production costs, allowing them to supply more at a lower price.
3. Analyze the options: Producers, Importers, Exporters, and Sellers are all involved in the market, but subsidies are most directly aimed at those who produce or sell goods domestically.
4. Recognize that importers and exporters deal with goods crossing borders, and subsidies usually target domestic production rather than trade activities.
5. Conclude that the group directly benefiting from subsidies in a market is the producers, as they receive financial support to reduce costs and increase output.