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In the Federal Budget 2020 it was announced that the government will implement several actions in year 2020

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In the Federal Budget 2020 it was announced that the government will implement several
actions in year 2020. Examine the effect the following actions on either aggregate supply or
aggregate demand.

(i) The minimum wage will be increased from RM1,100 to RM1,200 in major cities in
Malaysia. Therefore, all employers in these cities must pay their workers the new
minimum wages. (4 marks)

(ii) RM1.6 billion is allocated to build new hospitals and upgrade existing ones. (4 marks)