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    Question

    If factor cost is greater than Market price, then it

    means that: 
    A Indirect taxes > subsidies Correct Answer Incorrect Answer
    B Indirect taxes = subsidies Correct Answer Incorrect Answer
    C Indirect Taxes < Subsidies Correct Answer Incorrect Answer
    D Indirect taxes = and > subsidies Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    If factor cost is greater than Market price, then it means that Indirect Taxes < Subsidies as market price is the sum of factor cost and net indirect taxes.

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