How do labor unions affect the economy? (1 point) Responses They decrease demand by opposing low prices. They decrease demand by opposing low prices. They increase supply by keeping workers healthy. They increase supply by keeping workers healthy. They decrease supply by increasing worker wages. They decrease supply by increasing worker wages. They increase demand by ensuring ethical production.

Answer 1

Labor unions primarily affect the economy by decreasing supply by increasing worker wages. Unions negotiate higher wages and better benefits for their members, which can lead to increased labor costs for employers. This may result in reduced supply of certain goods or services, as businesses may cut back on production or increase prices to cover these costs. Additionally, the increased wages can enhance workers' purchasing power, which may potentially boost demand in other areas of the economy. However, in the context of your statement, the direct effect is on supply.