The curves Do Do and SoSo are the demand and supply curves respectively. What happens when government subsidizes producers in order to boost output?

  • A The supply curve will shift from SoSo to S2S2
  • B The supply curve will shift from SoSo to S1S1
  • C The supply curve will shift fromS 2S2 to S1S1
  • D The supply curve will shift from S1S1 to SoSo
  • E The demand curve will shift from DoDo to D1D1

The correct answer is A. The supply curve will shift from SoSo to S2S2

No explanation given
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