A sharp increase in the price of beef that causes consumers to switch to chicken is predicted to ____ the real wage and ____ employment of unskilled workers in a poultry processing plant.

Question

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If there is more demand for chicken, we would expect the price of chicken to increase too and the production of chicken becomes more profitable. As a consequence, chicken producers will be more inclined to hire workers and there will be more demand for poultry workers (demand shifts right). As a result, wages and employment will increase.

A Sharp Increase in the Price of Beef That Causes