When a Union Raises the Wage Above the Equilibrium Level

question 433

Multiple Choice

When a union raises the wage above the equilibrium level,

• A)the quantity of labor supplied and unemployment both rise.
• B)the quantity of labor supplied and unemployment both fall.
• C)the quantity of labor supplied rises and unemployment falls.
• D)the quantity of labor supplied falls and unemployment rises.

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Definitions:

Demand Curve

A graph showing the relationship between the price of a good and the quantity of that good consumers are willing and able to buy.

Living Wage

A wage level that is high enough to maintain a normal standard of living.

Employment

The condition of having paid work or the number of people employed in an economy or specific sector.

Wage

The fixed regular payment, typically calculated on an hourly, daily, or piecework basis, made by an employer to an employee for their labor or services.