Subsidies by GAYATRI MEHTA

Answer the following (Paper 2 , Paper 3 specific 2 marker, RLE for paper 1)

gayatrimehta11 — 2025-09-08 03:57:03 UTC

1. Define subsidy in your own words.

2. Give one real-world examples of subsidies (specify the industry and the country)

(Paper 2- Data Analysis + IA)

gayatrimehta11 — 2025-09-08 03:58:04 UTC

1. Why did the government introduce the subsidy?

2. Who were the intended beneficiaries?

3. Identify two unintended consequences of this subsidy.

Paper 3- Quantitative

gayatrimehta11 — 2025-09-08 03:59:26 UTC

A government introduces a subsidy of $2 per unit on a good. The initial equilibrium price is $10, and the equilibrium quantity is 500 units. After the subsidy, the new equilibrium quantity rises to 650 units. 1. Calculate: - Government expenditure on the subsidy - New price received by producers (including subsidy) - Change in total revenue for producers

2. Explain, using your answers above, how producer and consumer welfare are affected.

3. Comment on the opportunity cost of this government intervention.

Paper 1 - Essay

gayatrimehta11 — 2025-09-08 04:00:07 UTC

1. “Subsidies always improve social welfare.” Discuss this statement with reference to both short-term and long-term effects.

2. Compare the effectiveness of subsidies in a developed country versus a developing country. Which faces more risks of government failure?

Stakeholder Analysis

gayatrimehta11 — 2025-09-08 04:01:12 UTC

Role-Play Scenario

You are a journalist writing an editorial piece for a major newspaper on subsidies.

Choose ONE of the following roles and write a 50 word note from that perspective:

- A farmer defending agricultural subsidies. - A consumer criticizing the cost of subsidies. - A government minister justifying subsidies for renewable energy.