Suppose That Laws Are Passed Banning Labour Unions and That

question 18

Essay

Suppose that laws are passed banning labour unions and that resulting lower labour costs are passed along to consumers in the form of lower prices. Use the aggregate demand-aggregate supply model to illustrate graphically the impact in the short run and the long run of this favourable supply shock. Be sure to label: i. the axes; ii. the curves; iii. the initial equilibrium values; iv. the direction the curves shift; v. the short-run equilibrium values; and vi. the long-run equilibrium values. State in words what happens to prices and output in the short run and the long run.

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Definitions:

Diaphysis

The central piece or axis of a lengthy bone.

Medullary Cavity

The central cavity of bone shafts where red or yellow marrow is stored, vital for the production of blood cells and fat storage.

Articular Cartilage

Smooth, white tissue that covers the ends of bones where they come together to form joints, enabling smooth movements and absorbing shock.

Osteoclast Activity

The process involving bone-resorbing cells that break down bone tissue for the maintenance, repair, and remodeling of bones.