if there is an increase in wages and salaries without corresponding increase in the supply of goods and services, the situation will lead to

Answer Details

If there is an increase in wages and salaries without a corresponding increase in the supply of goods and services, the situation will lead to inflation. This is because workers will have more money to spend but the supply of goods and services available for purchase remains the same, leading to an increase in demand without a corresponding increase in supply. As a result, the prices of goods and services will increase, leading to inflation.