Question

8. If the government were to give every student a voucher to redeem at any school, it would be intervening through _________. If the government were to mandate no tuition cost more than $6,000/year without intervening in any other way, it would be intervening through__________.

Answer 1

Answer:

Subsidy ; Price Ceiling

Explanation:

Subsidy is the financial assistance by government, to increase a good's availability at cheaper price, to people.

Price Ceiling is the maximum mandated price by government, at which a good or service can be sold in market.

Government giving every student a voucher to redeem at any school : Is a form of financial assistance, which reduces the price paid by students. So, it is an example of Subsidy

Government mandating no tuition fee above $6000 : Is specification of maximum mandated price at which a good or service can be sold. So, it is an example of Price Ceiling.