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WAEC Economics 2015 Objective — Question 9

Question 9 of 50 from the West African Examinations Council (WAEC) Economics 2015 Objective paper, with the correct answer and a full explanation.

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An increase in production subsidies will shift

  • A. the demand curve to the left
  • B. the supply curve to the rightCorrect
  • C. both the supply and demand curves to the left
  • D. the supply and demand curves to the right

Explanation

A production subsidy lowers producers' costs, increasing their willingness and ability to supply, shifting the supply curve to the right.

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