How do per unit subsidies affect the producer surplus in a competitive market when considering the supply and demand framework?

Per unit subsidies are payments made by the government to producers for each unit of a good they produce, which lowers their costs. When a subsidy is introduced, the supply curve shifts to the right because producers can now afford to sell more goods at each price level. This increase in supply usually leads to a lower market price and a higher quantity of goods sold. As a result, the producer surplus, which is the difference between what producers are willing to accept and what they actually receive, increases because they can sell more units at a better price. For example, if a farmer receives a subsidy for each bushel of corn, they might grow and sell more corn, benefiting from both the subsidy and the higher total revenue from selling more corn.