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Consider the following microeconomic developments: (a) A rise in the minimum wage (b) An increase in the productivity of labor (c) A decrease in the cost of raw materials used in production Determine whether, and in what direction, each of these developments shifts the following microeconomic curves. For each development, state whether it shifts the curve to the right, left, or does not shift it at all. 1. Demand curve for a specific product 2. Supply curve for a specific product 3. Short-run cost curve for a firm 4. Long-run cost curve for a firm 1) A rise in the minimum wage: a) Demand curve for a specific product: This may shift the demand curve to the right because higher wages can increase consumers' purchasing power, leading to higher demand for certain goods and services. b) Supply curve for a specific product: This may shift the supply curve to the left because higher wages increase the cost of production, leading to lower profitability and potentially reducing the quantity supplied. c) Short-run cost curve for a firm: This would shift the short-run cost curve upward due to higher labor costs, leading to increased production costs. d) Long-run cost curve for a firm: In the long run, firms may adjust their production processes and technology to mitigate the impact of higher wages, so the effect on the long-run cost curve may be less pronounced. 2) An increase in the productivity of labor: a) Demand curve for a specific product: This may shift the demand curve to the right because higher productivity can lead to lower prices or higher quality, increasing consumer demand. b) Supply curve for a specific product: This would shift the supply curve to the right because higher productivity enables firms to produce more output with the same inputs, increasing the quantity supplied. c) Short-run cost curve for a firm: This would shift the short-run cost curve downward because higher productivity reduces production costs, leading to lower costs per unit of output. d) Long-run cost curve for a firm: Higher productivity can lead to technological advancements and efficiency gains, shifting the long-run cost curve downward. 3) A decrease in the cost of raw materials used in production: a) Demand curve for a specific product: This may not directly affect the demand curve unless the decrease in raw material costs leads to changes in the final product's price or quality.

b) Supply curve for a specific product: This would shift the supply curve to the right because lower input costs increase firms' profitability and encourage them to increase production. c) Short-run cost curve for a firm: This would shift the short-run cost curve downward because lower raw material costs reduce production costs. d) Long-run cost curve for a firm: Similarly, lower input costs can lead to efficiency gains and lower costs in the long run, shifting the long-run cost curve downward.

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