If workers demand and receive higher real wages (a successful wage push),the cost of production ________ and the short-run aggregate supply curve shifts ________.
A)rises;leftward
B)rises;rightward
C)falls;leftward
D)falls;rightward

Question

Quizplus · Accepted Answer

When workers demand and receive higher real wages, the cost of production increases, as labor becomes more expensive for firms. This increase in production costs causes the short-run aggregate supply curve to shift leftward, as firms are now willing to supply less output at any given price level.

If Workers Demand and Receive Higher Real Wages (A Successful