If membership in labour unions falls,production costs will:
A) increase,and SRAS will shift to the left,decreasing equilibrium GDP and increasing the aggregate price level.
B) fall,there will be a downward movement along SRAS,equilibrium GDP will increase,and aggregate price level will fall.
C) not change and AD will shift to the right,increasing equilibrium GDP and aggregate price level.
D) fall and SRAS will shift to the right,increasing equilibrium GDP and lowering the aggregate price level.

Question

Quizplus · Accepted Answer

If membership in labor unions falls, it typically leads to lower wage demands, reducing production costs. This can cause the short-run aggregate supply (SRAS) to shift to the right, increasing equilibrium GDP and lowering the aggregate price level.

If Membership in Labour Unions Falls,production Costs Will