Answer:
The question is not completed, here is the full question:
Domestic telecommunication companies in the United States are struggling due to foreign competition. How can the US government help to resolve this situation?
A. The government should implement subsidies as they would help domestic businesses be able to afford to lower the prices of their goods and thus become more competitive.
B. The government should implement subsidies as they would limit the amount of foreign goods available to consumers and thus help domestic producers become more competitive.
C. The government should implement quotas as they would help domestic businesses lower the costs of labor and capital goods on which they rely and thus become more competitive.
D. The government should implement quotas as they would artificially raise prices for foreign goods relative to domestic goods and thus help domestic producers become more competitive.
The answer is A.
Step-by-step explanation:
Subsidies are financial and trade benefits given to (usually) domestic companies by the government. They are used to make the price of a particular good made by that company artificially low. Most of the time, this is done to bolster domestic production.
When it comes to the implementation of subsidies, they are usually in the form of the non-existent tax burden, meaning that the subsidized business does not have to pay tax.
In this example, the US domestic telco company will make prices more competitive by receiving a subsidy from the government.