A Union Is Formed to Restrict Labour Supply in a Previously

question 89

Multiple Choice

A union is formed to restrict labour supply in a previously perfectly competitive labour market.If the union succeeds in raising the wage,

• A)employment will fall.
• B)employment will rise.
• C)employment will not change.
• D)the total wage bill will rise.
• E)the total wage bill will fall.

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Definitions:

Rational Pricing

A financial theory stating that asset prices will reflect all available information and respond rationally to changing conditions.

Risk Averse

The preference for certainty over uncertainty, with individuals or entities avoiding risks when making decisions.

Interest Rates

The cost of borrowing money, expressed as a percentage of the total amount loaned, or the return on invested money.

Efficient Markets Hypothesis

A theory that suggests financial markets are informationally efficient, meaning prices of traded assets reflect all available information at any given time.