Businesses successfully lobby Congress into passing legislation that eliminates the minimum wage law.The impact of this change would:
A)Shift the short-run aggregate supply curve to the left
B)Make the long-run aggregate supply curve less vertical
C)Shift the short-run aggregate supply curve to the right
D)Make the short-run aggregate supply curve horizontal

Question

Quizplus · Accepted Answer

Eliminating the minimum wage law would allow businesses to pay their workers less, resulting in lower production costs and an increase in supply. This shift would be represented by a rightward shift in the short-run aggregate supply curve. The long-run aggregate supply curve would remain unchanged, as the elimination of the minimum wage law would not affect the economy's potential output.

Businesses Successfully Lobby Congress into Passing Legislation That Eliminates the Minimum