What is the most likely effect on the supply of a good if the government implements a subsidy for its production?
1
The supply curve shifts to the left as producers face higher taxation.
2
The supply curve shifts to the right due to decreased production costs.
3
No significant change in supply as subsidies affect only demand.
4
The supply becomes perfectly inelastic as subsidies ensure a fixed production level.
5
The supply curve becomes steeper, indicating a decrease in supply elasticity.