Consider the above figure, which displays the situation faced by a union employed by a firm with the labor demand curve D
This union has total membership of Q3 workers, but its single wage setting goal is to maximize wages for the Q1 members with the most seniority. If the union managers accomplish this goal, what occurs? A) All of the union members will be employed at the wage rate W3.
B) All of the union members will be employed at the wage rate W1.
C) The senior members of the union will receive a wage equal to W3, but Q3 union members will be unemployed.
D) The select group of senior union members will have work and receive a wage of W3, but Q3 -Q1 union members will not be employed by the firm.
D
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