Suppose all blue-collar workers receive a substantial pay increase.What will happen in the product markets that employ these workers?
A)Supply will decrease.
B)Supply will increase.
C)Output will rise.
D)Demand will decrease.
E)Prices will fall.

Question

Quizplus · Accepted Answer

A substantial pay increase for blue-collar workers will increase production costs, leading to a decrease in supply in the product markets that employ these workers.

Suppose All Blue-Collar Workers Receive a Substantial Pay Increase