Suppose the federal government allows labor unions to act as the sole seller in labor markets, but the government collects a $1 per hour fee to cover unemployment insurance for each union worker
Assuming this fee is not so large that it forces the unions to disband, what is the impact of this fee on the equilibrium wage and employment level in the monopolized labor market? A) After-tax wages and employment decline.
B) After-tax wages increase and employment declines.
C) Employment increases and after-tax wages decline.
D) No change in after-tax wages or employment levels.
A
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The absolute value of the slope of the production possibilities frontier at the production point provides a measure of both the relative price of S in terms of T and the opportunity cost of producing one more units of S calculated in terms of output
of T foregone. Indicate whether the statement is true or false
The U.S. Postal Service
a. has as much monopoly power now as it had 100 years ago b. has lost much of its market power due to new competitors and new technologies c. has increased its prices by less than the rate of inflation during the past 25 years d. is more mechanized and more computerized than its potential competitors e. is a perfectly competitive firm