The experience of the Teamsters in the late 1970s and early 1980s suggests that
a. there are few restraints on the ability of a strong union to increase the wages of its members.
b. product market competition with goods made from (or services provided by) nonunion labor significantly limits the ability of a union to get increased wages for its members.
c. higher wages tend to stimulate aggregate demand, which makes it easier for a union to gain still higher wages.
d. wages are established by the relative skill of union and management negotiators, independent of market conditions.
B
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The quantity supplied of a good is
A) the same thing as the quantity demanded at each price. B) the amount that the producers are planning to sell at a particular price during a given time period. C) equal to the difference between the quantity available and the quantity desired by all consumers and producers. D) the amount the firm would sell if it faced no resource constraints.
Suppose the Federal Reserve System has a required reserve ratio of 0.10 and there are no excess reserves in the system. If the Open Market Committee buys $50 million of securities from the commercial banking system, the total lending capacity for the system
A. Increases by $500 million. B. Decreases by $500 million. C. Decreases by $50 million. D. Increases by $50 million.