What will be the result of a subsidy that is given to the producers of a good with an inelastic demand curve?
1 )
The equilibrium price of the good will fall by a larger percentage than the fall in equilibrium quantity.
The equilibrium price of the good will fall by a larger percentage than the rise in equilibrium quantity.
3 )
The equilibrium price of the good will fall by a smaller percentage than the fall in equilibrium quantity.
4 )
The equilibrium price of the good will fall by a smaller percentage than the rise in equilibrium quantity.
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