Nonunion wages should be modeled as
A) sticky, because they imitate union wages rather closely.
B) sticky, because their contracts cannot contain COLA clauses.
C) perfectly flexible, because wage contracts are illegal outside of unions.
D) perfectly flexible, because workers willing to take the risks of full wage flexibility are precisely those workers who have rejected unionization.
A
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Refer to Table 2-12. Does either Guatemala or Honduras have an absolute advantage and if so, in what product?
A) Honduras only has an absolute advantage in producing sailboats. B) Guatemala has an absolute advantage in producing both products. C) Guatemala only has an absolute advantage in producing canoes. D) Honduras only has an absolute advantage in producing canoes.