Suppose There Is a Competitive Market for Retail Workers at a Large

question 43

Multiple Choice

Suppose there is a competitive market for retail workers at a large shopping mall that is large enough to constitute its own labour market. The labour demand curve is QD = 1000 - 20(w) . The labour supply curve is QS = 400 + 40(w) . Suppose that a union now successfully organizes the workers at this mall and obtains a wage rate of $11 (but does not affect the demand curve) . The number of unemployed workers in this mall labour market becomes

• A) 20.
• B) 80.
• C) 40.
• D) 100.
• E) 60.

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Definitions:

Demand Increase

A rise in the quantity of a product or service that consumers are willing and able to buy, typically due to factors like lower prices, increased income, or changes in preferences.

Labor Union

An organization formed by workers to protect their rights and interests, including negotiating wages and working conditions.

Union Shop

A workplace where employees are not required to join the union as a condition of employment, but must join within a certain period of time after hire.

Labor Demand

The total amount of workers that employers want to hire at a given wage rate and time.