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Effects of a major union wage settlement

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Reference no: EM131510469

Supply vs. Demand Shocks

What are the effects of a major union wage settlement on the price level and real GDP? That is, when significant increases in wages or a sudden increase in price of an important raw material, such as oil, occurs. Is this a supply shock, demand shock, or both? Can you think of an example of such an important change?

Reference no: EM131510469

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