If workers demand and receive higher real wages as a result of successful wage push, the cost of production __and the aggregate supply curve shifts Select one:
a. falls; left
b. rises; left
c. falls, right
d. rises; right

= rises; left

b. rises; left

Explanation:

Wage is the amount incurred in compensating workers for their services. It is a major expense for producers. Wage is one of the inputs in the manufacturing process; producers need labor services to continue operating. An increase in wages raises the production cost of the finished goods.

An increase in the cost of production may limit the quantity of output from the producers. As production cost increase, producers will require additional funds to finance the high production costs. Since resources are scarce in every industry, producers may opt to lower their output to avoid incurring high costs. A decrease in the production volume shifts the aggregate supply curve to the left.