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A subsidy is a sum of money given by the state to an industry to keep product prices lower. For example, if it costs Bill $10 to produce a hat, but someone in China can do it for $5, a $6 per hat subsidy from Uncle Sam can help Bill compete. Subsidies can benefit society by promoting new technologies like solar energy, but can also harm by making industries unprofitable without aid. The US heavily subsidizes some industries at the expense of poorer countries like Brazil.
