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A-Level Economics · Subsidy diagram question

Which point on the price axis do PRODUCERS receive per unit (price + subsidy)?

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The diagram

The answer

Point A. £3 from the buyer + £4 from the government = £7 — read off the ORIGINAL supply curve at point F. Producers get the consumer's £3 PLUS the £4 subsidy = £7 (point A) — found on the original S at the new quantity, point F.

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This is one of 5 questions on the subsidy diagram — every corner lettered, every wrong answer diagnosed.

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