The short- run aggregate supply curve shifts leftward when the
A) general level of technology advances.
B) price level increases.
C) availability of on- the- job training expands to all workers.
D) money wage rate increases.

Question

Quizplus · Accepted Answer

An increase in the money wage rate will increase per-unit production costs because workers' wages are a primary cost of production. This increase in costs will cause a leftward shift in the short-run aggregate supply curve, indicating a decrease in the quantity of goods and services that firms are willing and able to produce at any given price level.

The Short- Run Aggregate Supply Curve Shifts Leftward When the