When a union successfully raises the wages of its members, it will also
a. increase total productivity, which will generally increase in proportion to the wage rate.
b. encourage employers to purchase more of the union labor.
c. increase the share of income allocated to labor as opposed to capital.
d. increase the employer's incentive to find substitutes for union labor.
D
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Consider a good with a price elasticity equal to 1 at every point on its demand curve. Which of the following statements is correct?
a. Total revenue always rises exactly in proportion to a drop in the price. b. Total revenue always rises exactly in proportion to a rise in the price. c. Total revenue does not change if the price changes. d. Total revenue drops to zero whenever the price rises. e. Total revenue always doubles if the price drops.
The cost disease of personal services causes
a. the cost of health care to rise faster than the economy's rate of inflation. b. legislators to blame declining standards of quality at public hospitals on greedy doctors or administrators. c. legislators to propose price controls on insurance. d. All of the above are correct.