We Would Expect Unions to Have a More Difficult Time

question 219

Multiple Choice

We would expect unions to have a more difficult time negotiating higher wages for their members when

• A) labor represents a small portion of total costs.
• B) the product produced makes up a small portion of families' budgets.
• C) the product produced has several close substitutes.
• D) there are not good substitutes for labor in the production process.

---

Definitions:

PVFA Factors

Present Value Factor for Annuities, used in calculating the present value of a series of equal payments at regular intervals.

Effective Interest Rate

The actual return on an investment, considering the compounding of interest.

Compounding

The process of generating earnings on an asset's reinvested earnings, leading to exponential growth over time.

Present Value

The modern-day valuation of upcoming money amounts or cash flow sequences, adjusted according to a given rate of return.