What is the economic justification for subsidies in the agriculture sector?
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. It is an incentive to provide the benefits of advanced technology and decrease the cost of production.
The economic justification for subsidies in the agriculture sector is "It is an incentive to provide the benefits of advanced technology and decrease the cost of production." Subsidies are often provided to support farmers in adopting modern farming techniques, purchasing essential inputs like seeds, fertilizers, and machinery, and improving productivity. This helps reduce the cost of production, making agricultural products more affordable and boosting food security. Subsidies also aim to ensure the sustainability of farming and support rural livelihoods.