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Given ceteris paribus, the removal of a 3 percent subsidy on the interest rate paid by...

Given ceteris paribus, the removal of a 3 percent subsidy on the interest rate paid by celery farmers will have what effect on the market equilibrium of celery? (a)Price will increase, and quantity will increase (b)Price will decrease, and quantity will decrease (c)Price will increase, and quantity will decrease (d)Price and quantity will stay the same

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Answer #1

This action would reduce the quantity supplied at a given price (left shift of supply curve)

Option C is correct

Price will increase and quantity will decrease.

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