Final answer:
A grant is financial support provided by the federal government to a state for a specific purpose, while a mandate is a federal requirement imposed on states, which may come without financial support. Subsidies are payments that reduce firm costs to increase production, contrasting with taxes that add to costs. Option a.
Step-by-step explanation:
A form of financial support the federal government provides to a state for a specific purpose is a grant option a. Grants are payments from one level of government to another, earmarked for specific projects such as road construction, education, and urban renewal. These funds often come with conditions - the "strings attached" - that dictate how the money should be used, and the recipient must adhere to these rules for spending. If a grant is not used as stipulated, it must be returned.
Comparatively, a mandate is a requirement imposed by the federal government upon state and local governments, which may be tied to grants or could occur independently as unfunded mandates. Unlike grants, mandates do not provide financial incentive but rather include penalties for non-compliance.
A government subsidy is a financial aid provided to a firm, reducing production costs and inducing a supply shift to the right, unlike a tax which increases production costs and causes a supply shift to the left. On the other hand, taxes are compulsory contributions to state revenue, levied by the government on workers' income and business profits or added to the cost of some goods, services, and transactions.