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WAEC Economics 2023 Question 12

Question 12

Theory of Supply

If the government stops subsidy on cocoa production, the supply curve of cocoa will

  1. A.shift to the right.
  2. B.become vertical.
  3. C.shift to the left.
  4. D.remain unchanged.
Show the answer and explanation

Answer: C (shift to the left.)

Explanation

Removing a subsidy raises costs, so supply falls.