Question

What will be the effect of raising production subsidies on the supply of a commodity?

विकल्प

• Downward movement along with the supply curve.

• Leftward shift of supply curve.

• Rightward shift of supply curve.

• Upward movement along the supply curve.

Answer 1

Rightward shift of supply curve.

Explanation:

Raising production subsidies reduces the cost of production for suppliers, which encourages them to produce and supply more of the commodity at the same price levels. A rightward shift of the supply curve represents this increase in supply.