The Relative Union Wage Advantage Is Generally

question 11

Multiple Choice

The relative union wage advantage is generally

• A) about 50% in the United States.
• B) smaller in the United States than in Europe.
• C) larger in the public sector than in the private sector.
• D) larger during recessions.

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Definitions:

Operating Leverage

A financial concept that measures the extent to which a firm can increase operating income by increasing revenue, highlighting the impact of fixed versus variable costs.

Break-even Point

The point at which total costs equal total revenue, meaning the business makes neither a profit nor a loss.

Variable Cost

Costs that change in proportion to the level of production or business activity, such as materials, labor, and utility costs.

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salary, or insurance, providing stability to a company's expense structure.