To reduce labor surplus above the equilibrium union wage level, a union may do all of the following EXCEPT
A) lengthen apprenticeship period.
B) assign jobs based on seniority.
C) limit the number of new members accepted.
D) encourage nonunion members to join the union.
Answer: D
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Which of the following statements best captures the intuitive reason behind discounting?
A) Since incomes rise over time, discounting means that we place less weight on benefits and costs today and more weight on benefits in the future. B) Since dollars today can be invested, to obtain $1 in the future we have to give up less than $1 today. Hence future benefits and costs are given more weight than benefits and costs today. C) Since investments yield a return, we have to give up less than $1 today to obtain $1 in future benefits. Hence we place less weight on future benefits and costs than we would on benefits and costs that dollars occur today. D) Since dollars today can be invested, yielding a positive return, discounting places more weight on future returns.
What economic concept would be most closely associated with a situation where an aluminum plant expands its operations and uses extensive computerization in the production line to reduce per-unit costs of production?
A. Infrastructure B. Human capital C. Network effects D. Economies of scale