3. Now suppose that the government adopts policies that make it more difficult for foreign companies to enter local markets. If we assume that the level of employment and the supply of labor remain constant, which of the following statements about inflation-creating mechanisms is correct? (There may be more than one correct answer). A. With reduced competition, companies can now set a higher profit margin on their costs, which raises the pricing curve. B. The labor market is not in equilibrium due to the reduction in real wages, since workers now lack incentives to work at the existing level of unemployment. Therefore, wages will increase, which is reflected in an upward shift in the wage setting curve. C. If companies can continue to collect the new (higher) profit margin now applied to the new higher wage, prices rise again, lowering the real wage until it adjusts to the pricing curve.