Suppose the Market for Autoworkers Is Initially in Equilibrium, but Then

question 376

Multiple Choice

Suppose the market for autoworkers is initially in equilibrium, but then the demand for automobiles increases and simultaneously the automakers allow autoworkers less flexibility working at the plants. What happens in the market for autoworkers?

• A) The equilibrium wage rate will increase and the equilibrium quantity of labor will increase, decrease or stay the same.
• B) The equilibrium wage rate will increase, decrease or stay the same and the equilibrium quantity of labor will increase.
• C) The equilibrium wage rate and the equilibrium quantity of labor will both decrease.
• D) The equilibrium wage rate will decrease and the equilibrium quantity of labor will increase.

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Definitions:

Evaluate Probabilities

The process of assessing the likelihood of various outcomes in order to make informed decisions under conditions of uncertainty.

Recall from Memory

The cognitive process of retrieving information from the past, stored in the human brain.

Personal Biases

Individual prejudices or predispositions that influence one's perspective and decision-making process.

Implicit Favorite

An unconscious bias or preference for a particular option or individual, often influencing decision-making processes without explicit awareness.