If a Union Is Able to Bargain for a Wage

question 142

Multiple Choice

If a union is able to bargain for a wage that is higher than the equilibrium, this means that:

• A)all workers will earn a wage equal to their value of marginal product.
• B)some excess supply of labor or unemployment will result at this wage rate.
• C)compensating differentials will be erased in this market.
• D)diminishing returns will not exist in this market.

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Definitions:

Cakes

Baked desserts that are typically sweet and made from ingredients such as flour, sugar, and eggs.

Absolute Advantage

A scenario in which a country can produce a particular good or service more effectively than another country with the same amount of resources.

Comparative Advantage

an economic principle that posits a country or entity can produce a particular good or service at a lower opportunity cost than its trading partners, leading to beneficial trade.

Medium Of Exchange

Anything that facilitates trade by being generally accepted by all parties in payment for goods or services.