Question 36
MediumOriginal questionRead the two statements and choose the correct option.
I. A subsidy to producers shifts the supply curve to the right.
II. A fall in the number of firms shifts the market supply curve to the right.
Show the answer and explanation
CorrectNot quiteAnswer A
Correct answer: A
Explanation
I is true: a subsidy lowers producers' cost per unit.
II is false: fewer firms supply less at each price, a leftward shift.
- Concept
- Shifters of supply
- Typical timeTypical
- 70 s
- Your timeYours
- —
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