The Demand for Unionized Labor Will Generally Be More Elastic

question 36

Multiple Choice

The demand for unionized labor will generally be more elastic, and it will be more difficult for the union to achieve above-equilibrium wages when

• A) there are no close substitutes for the unionized workers.
• B) the domestic producers of the good produced by the unionized workers face weak competition from foreign suppliers of the good.
• C) the cost of employing the unionized workers is a large part of the total cost of the product that they produce.
• D) the demand for the product produced by the unionized workers is highly inelastic.

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Definitions:

Work In Process Account

An account that tracks the costs associated with the production process, including labor, materials, and overhead, for products that are not yet completed.

Machine Hours

A measure of the amount of time a machine is operated during a given period, used as a basis for allocating manufacturing overhead.

Overhead Rate

The ratio used to allocate indirect costs to products or services, based on a specific base such as labor hours or machine hours.

Work In Process Account

A financial account used to track the costs associated with the production of goods that are not yet completed.