Subsidy on goods with positive externalities leads to:

CA Foundation · Business Economics · MTP · January 2026
Subsidy on goods with positive externalities leads to:
(A) A. Higher cost
(B) B. Higher price
(C) C. Lower price
(D) D. Inefficiency

Suggested Answer and Working Notes:

Correct Answer: Option (C)

C. Lower price

Topics: Public Finance

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