Arrange the following steps in the correct order of how per unit subsidies influence production and market efficiency: A) Firms receive subsidies for each unit produced, B) Marginal costs for firms decrease, C) Firms increase production levels, D) The market moves towards allocative efficiency.

When the government provides per unit subsidies, the first step is that firms receive these subsidies for each unit they produce. This financial support lowers the marginal costs for firms, making it cheaper for them to create their products. As a result, with lower costs, firms are encouraged to increase their production levels. With more goods available in the market, the supply increases, which helps the market move towards allocative efficiency, where resources are used in the most effective way to meet consumer demand. For example, if a dairy farm receives a subsidy for each gallon of milk produced, it can lower prices and produce more milk, benefiting consumers and the economy overall.