Economics Multiple Choice Question – 5 May 2021

A government gives a subsidy to a producer of a product.

What will be the likely effect of this?

Select ONE answer:

1. a shift to the left in the demand curve and a rise in equilibrium quantity
2. a shift to the left in the supply curve and a rise in equilibrium quantity
3. a shift to the right in the demand curve and a fall in equilibrium price
4. a shift to the right in the supply curve and a fall in equilibrium price

Show your workings to arrive at your answer, and explain and justify your reasons:……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple choice question is suitable for Economics KS4 and KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct

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