Question

Often domestic governments help fund the costs associated with producing and marketing certain products, such as gasoline, steel, and electronics to make them more price-competitive in foreign markets. These governments are using ____________.

Answer 1

subsidies

Step-by-step explanation:

A subsidy is an amount of money given to a private business by a government entity (either national, state or local) in order to help the business lower the sales price of a commodity or a service that they offer. In many countries, different governments subsidize fuels, utilities, certain foods, etc.

The logic behind subsidies is that low income families benefit from lower prices, but most of the time subsidies help high income families more. For example, in a country that subsidizes electricity, the people who benefit the most are the owners of large houses that use a lot of electricity.