The supply curve of a locally-produced good may shift to the right if

a

there is an increase in taxes on inputs

b

government increases subsidies

c

rural-urban migration is encouraged

d

the price of the commodity increases

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Explanation

Correct Option
b

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SirClassic
2 years ago

16-07-23; 09:26am 🤔
The supply curve of a locally-produced good may shift to the right if

A. there is an increase in taxes on inputs
B. government increases subsidies
C. rural-urban migration is encouraged
D. the price of the commodity increases

Some of the factors that cause Shift in demand and supply are:
01. Price of other commodities
02. Market size
03. Consumer's income
04. Consumer's taste and preference
05. Others (i.e, weather, government policies, SUBSIDIES, technology, new trends, infrastructural facilities, political stability, etc.

Thus, increase in price of the commodity cannot cause a shift (increase and decrease) in supply and demand respectively.


Increase in price of the commodity can only cause a movement along the demand or supply curve (i.e, increase and decrease in quantity of supply and demand respectively.


There's a difference between "shift and movement".
Shift means increase or decrease in demand or supply, while
Movement means increase or decrease in QUANTITY demanded or supplied.


As you can see, "shift" does not include quantity while "movement" emphasizes on QUANTITY.


The correct answer is option "B"

JoyCollins590
2 years ago

The answer is B

oluwafemifx
1 year ago

A shift in supply cannot be caused by change in the price of the product but other factors such as government subsidy

black04
2 years ago

the answer is B.
Shift in supply curve denotes change in supply
Movement along supply curve denotes change in quantity supplied

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