Costs to the Firm Arising from Reaching Agreements on Input

question 127

Multiple Choice

Costs to the firm arising from reaching agreements on input prices with suppliers and then ensuring that terms of agreements are fulfilled, are called

• A) negotiation costs.
• B) agency costs.
• C) transactions costs.
• D) implicit costs.

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Definitions:

Pattern Bargaining

A labor negotiation strategy where unions use the outcome of one successful negotiation as a model or "pattern" for subsequent negotiations with other employers.

Legal Bargaining Item

Issues or matters that are legally required to be negotiated in good faith between unions and employers during collective bargaining.

Union Representation

The act of a labor union acting as the intermediary between the workforce and management to discuss employment terms, grievances, and rights.

Closed Shop Provisions

Labor agreement terms requiring that employees be members of a labor union as a condition of employment, now illegal in many places under "right to work" laws.