The Graphs Below Refer to Two Separate Product Markets

question 43

Multiple Choice

The graphs below refer to two separate product markets.Assume that society's optimal level of output in each market is Q₀ and that government purposely shifts the market supply curve from S to S₁ in diagram (a) and from S to S₂ in diagram (b) .The shift of the supply curve from S to S₂ in diagram (b) might be caused by a per unit:

• A)subsidy paid to the producers of this product.
• B)tax on the producers of this product.
• C)subsidy paid to the buyers of this product.
• D)tax on the buyers of this product.

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Definitions:

Competitively

The manner of engaging in business or sports aiming to achieve superiority over opponents by offering better value, service, or performance.

Quality Control

The processes and measures implemented to ensure that the quality of a product or service meets the specified standards and requirements.

Established Quality Standards

Set criteria or benchmarks that define the specifications, technical details, and performance measures products or services must meet to ensure they are fit for purpose and meet customer expectations.