1.2.2 - theme 1

Question 1

What are government subsidies?

Answer 1

A payment given to producers, usually to encourage production of a certain good.

Question 2

What are indirect taxes?

Answer 2

Taxes imposed by the government on spending e.g. VAT and Excise duties. Responsibility for payment lies with the business.

Question 3

What is supply?

Answer 3

The amount that producers are willing/able to produce at a given price/over a given period of time.
or
the amount that producers are willing and able to produce at a given price