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A nationwide improvement in infrastructure and technology leads to a significant increase in the average output per worker. According to the price-setting model, this development will cause the price-setting curve to shift downward, thereby reducing the real wage that firms are willing to offer at any level of employment.
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A nationwide improvement in infrastructure and technology leads to a significant increase in the average output per worker. According to the price-setting model, this development will cause the price-setting curve to shift downward, thereby reducing the real wage that firms are willing to offer at any level of employment.