Assuming that the demand for cars is constant, an increase in the cost of labour used in producing cars will lead to:

Question

Quizplus · Accepted Answer

An increase in the cost of labor raises the production costs for cars, leading manufacturers to supply fewer cars at any given price. This shift in the supply curve to the left, with demand constant, results in a higher equilibrium price and a lower equilibrium quantity.

Assuming That the Demand for Cars Is Constant, an Increase