-Use the Figure Above to Answer This Question

question 26

Multiple Choice

-Use the figure above to answer this question. Consider a perfectly competitive market experiencing good times. Figure ________ shows a firm maximising profit in the short run because it produces ________ units and makes an economic profit of ________.

• A) A; 100; $2 per unit
• B) C; 100; $3 per unit
• C) B; 100; $0 per unit
• D) A; 90; $3 per unit
• E) C; 110; $2 per unit

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Definitions:

Non-Unionized Industries

Sectors of the economy where the workforce is not part of a labor union or covered by a collective bargaining agreement.

Recession

A phase of short-term economic downturn marked by decreased business and manufacturing operations, typically recognized by a decline in Gross Domestic Product for two consecutive quarters.

Efficiency-Wage Theory

The concept that employers may pay a higher wage than the market equilibrium to increase worker productivity, loyalty, and satisfaction, thereby reducing turnover and shirking.

Labor Unions

Organizations that represent workers in negotiations with employers over wages, working conditions, and benefits to protect their rights and interests.