would the government subsidizing the sock industry shift the demand or supply curve, and would it be to the?

Question

left or right?

Answer 1

I don't believe there is a shift. Quantity consumed will increase, but the increase is not visible in graph since the government is paying for those extra quantity produced by producers.
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I was wrong, I guess my int. micro book is not reliable as I thought. Demand curve will shift right. http://en.wikipedia.org/wiki/Economic

Answer 2

No no no a decrease in prices does not shift demand it moves you along demand.
since you say they subsidize the sock industry the typical way to analyze this is to shift the supply curve to the right. If it is a per unit subsidy it shifts the supply curve down by the amount of the subsidy. Where the new supply and demand intersect is the price the consumer pays add the subsidy and you get the amount the producer receives.

Answer 3

All government subsidies to industry will tend to increase supply, which depress prices. The depressed prices should increase demand. The 'increase' in supply might not be seen as a shift, as many government subsidies tend to prop up against a desired reduction in production.