When security guards at the airport negotiate a higher wage, the cost of operating the airport increases. Managers at the airport should

Question

Quizplus · Accepted Answer

When the cost of operating the airport increases due to an increase in wages for security guards, the managers at the airport should decrease the supply of airport services to maintain profitability. This could involve reducing the number of flights or cutting back on certain amenities. By decreasing the supply of airport services, the airport can better manage its costs and maintain its financial health. Increasing the supply of airport services or increasing the quantity demanded of airport services would not be appropriate responses in this scenario, as it would only increase the cost of operating the airport further.

When Security Guards at the Airport Negotiate a Higher Wage