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A subsidy is a sum of money from the state given to certain industries to keep prices lower. For example, if Bill's hat costs $10 to produce but can be made in China for $5, a $6 subsidy can make Bill's hats cheaper. Subsidies can benefit society by encouraging new technologies like solar energy or space exploration. However, they can also harm by making unprofitable industries viable in developed countries at the expense of poorer nations like Brazil.
