The wage rate paid by Walkman producers falls and at the same time the price of raw materials used in the production of Walkmans rises. You predict that the supply curve of Walkmans will

Question

Quizplus · Accepted Answer

The supply curve could shift either leftward or rightward because the decrease in wage rates would tend to increase supply (shift rightward), while the increase in the price of raw materials would tend to decrease supply (shift leftward). The net effect depends on the relative magnitudes of these changes.

The Wage Rate Paid by Walkman Producers Falls and at the Same