Question

b) they reduce the cost of production for firms c) they decrease demand for the product d) they limit the number of sellers if the cost of labor increases due to a minimum wage increase, what happens to supply? 1 point a) supply increases b) supply decreases c) supply remains unchanged d) supply becomes perfectly elastic

Explanation:

When the cost of labor (a production - input) increases due to a minimum wage increase, firms face higher production costs. Higher production costs make it less profitable for firms to produce the same quantity at each price level. As a result, firms will reduce the quantity they are willing to supply at each price, which means the supply decreases.

Answer:

B) Supply decreases