Assume a Cobb-Douglas production is a good representation of the economy, the substitution effect is stronger than the income effect, the economy is initially at equilibrium, and that the real wage is flexible. Now suppose you observe the equilibrium real wage and labor increasing after a shock hits the economy. This must mean that a Positive labor supply shock occurred in the labor market. Positive labor demand shock occurred in the labor market. Negative labor supply shock occurred in the labor market. Negative labor demand shock occurred in the labor market