A Rise in the Minimum Wage Increases the Demand for Union

question 100

Multiple Choice

A rise in the minimum wage increases the demand for union labor because this policy change

• A) lowers the wage rate paid to union labor.
• B) raises the productivity of union labor.
• C) lowers the cost of a substitute for union labor.
• D) lowers the productivity of union labor.
• E) raises the cost of a substitute for union labor.

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Definitions:

Peak Demand

The highest level of demand for a product or service over a specific period of time.

Forward Buy

A purchasing strategy where a buyer purchases larger quantities of goods in advance to take advantage of lower prices or to hedge against future price increases.

Profitability

The ability of a business to generate more revenue than the expenses incurred, resulting in a profit.

Manufacturing Capacity

The maximum amount of products a factory or production facility can produce within a given time period.