The SAS curve shifts leftward if
A) good weather increases agricultural harvests.
B) OPEC reduces world oil prices.
C) tax cuts stimulate labor supply.
D) the money wage rate increases.

Question

Quizplus · Accepted Answer

An increase in the money wage rate increases production costs for businesses, which typically reduces the quantity of goods and services supplied at any given price level, leading to a leftward shift in the Short-Run Aggregate Supply (SAS) curve.

The SAS Curve Shifts Leftward If