. Suppose that the bicycle maker's labor union bargains for an increase in its wages. Furthermore, suppose...

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. Suppose that the bicycle maker's labor union bargains for an increase in its wages. Furthermore, suppose this event raises the cOSt of production, makes bicycle manufacturing less profitable, and reduces the quantity supplied of bicycles by 20 units at each price of bicycles. Plot the new supply curve and the original supply and demand curves in Exhibit 2. What is the new equilibrium price and quantity in the market for bicycles?

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