If a union establishes by collective bargaining a wage rate that is above a competitive market equilibrium wage rate, then
A) an excess quantity of labor will be supplied.
B) a shortage of labor will result.
C) there will be an increase in total employment.
D) management will want to substitute labor for machinery.
A
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If prices were rising at 5% per year during a recession, which of the following responses from firms would help facilitate the economic recovery, protect worker morale, AND reduce the firm's real labor costs?
A. A nominal wage decrease of 1% B. A nominal wage increase of 7% C. A nominal wage increase of 3% D. A nominal wage increase of 5%
The money multiplier determines how much
A) real GDP will be expanded given an increase in autonomous investment. B) the monetary base will be expanded given a change in the quantity of money. C) the quantity of money will be expanded given a change in the monetary base. D) money demand will expand given a change in the quantity of money.