Answer to Question #133559 in Economics for Dorothy Sebotsa

Question #133559

The state subsidizes bread by 20 c per loaf. The factor cost per loaf is 1.70 therefore the market price is

Expert's answer

If the state subsidizes bread by 20 c per loaf and the factor cost per loaf is 1.70, then the market price is not less then 1.7 - 0.2 = 1.5 per loaf.

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