2019 Q20 Economics HSC help (1 Viewer)

quickoats

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A subsidy would move the domestic supply curve so the equilibrium would be at the world price. Think of it as supplying more at a given price (since the govt is contributing). The subsidy is given by the vertical distance between the original and new supply curves which in this case is $4.Screen Shot 2020-08-26 at 9.58.28 pm.png
 

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