If the government decided to subsidize the production of bobble-head dolls a) the supply curve will shift to the left. b) the supply curve will shift to the right. c) the demand for bobble-heads will decrease. d) the demand for bobble-heads will equal the supply.

The correct answer is - B) the supply curve will shift to the right.

If the government decides to subsidize the production of bobble-head dolls, than the production of these dolls will increase. The reason for the increased production will be that part of the expenses for the production are paid by the government, not the company that produces them, thus the company will try to benefit of this measure by producing more. The increase in the production means that the supply on the market will also experience an increase, thus making the supply curve go towards the right side.

true true true true that all

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