Final answer:
A decrease in nominal wages will cause a leftward shift of the short-run aggregate supply curve by reducing costs of production but also contracting the output produced in the market.
Step-by-step explanation:
A decrease in nominal wages will cause the short-run aggregate supply curve to shift to the left. When nominal wages increase, the costs of production also increase, leading to higher prices and a decrease in the equilibrium quantity; conversely, a decrease in wages would lead to lower production costs, but fewer goods and services being supplied at the existing price, as firms may reduce output or shut down, contracting the output produced in the market. Additionally, events like a pandemic can cause a significant reduction in the supply of workers and create a temporary, but large, decrease in supply, leading to a leftward shift in the supply curve.