Suppose That Butchers and Bakers Have No Unions

question 494

Multiple Choice

Suppose that butchers and bakers have no unions. Now suppose the butchers form a union. What does this do the labor supply of and wages of bakers?

• A)It increases the labor supply and wages of bakers.
• B)It increases the labor supply and decreases the wages of bakers.
• C)It decreases the labor supply and increases the wages of bakers.
• D)It decreases the labor supply and wages of bakers.

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Definitions:

Interest Rate

The amount charged by a lender to a borrower for the use of assets, expressed as a percentage of the principal.

Lease Payments

Regular payments made by a lessee to a lessor for the use of an asset.

Cost of Funds

The interest rate that financial institutions pay for the use of money or funds they lend out to borrowers.

Principal

Principal refers to the original sum of money borrowed in a loan or invested, exclusive of any interest or dividends.