Suppose that a town has two major bottling plants. One of these bottling plants is unionized and the union has just negotiated a 7% wage increase each year for the next two years. Which of the following is most likely to occur?
A. The only effect will be that the price charged by the unionized bottling plant will increase to cover the additional costs of labor.
B. The price of labor in the unionized bottling plant will increase, but there will be no changes in the price of labor in the nonunionized bottling plant.
C. The price of labor will change in both the unionized and nonunionized bottling plants, but no other input markets will be affected.
D. The price of labor will change in both the unionized and nonunionized bottling plants. Employment of labor and other inputs is also likely to change in both bottling plants.
Answer: D
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The Millennium Development Goals include
a. eliminating the proportion of people living on less than $1 per day. b. universal primary education. c. increasing exports by one half. d. all of the above.
Markets characterized by declining long-run average costs are often referred to as
A. natural monopolies. B. diseconomies of scale. C. perfect competition. D. nonprofit organizations.
Most foreign investment is today is directed towards high-income countries because
A) there are tax breaks and subsidies available. B) markets are larger, so transportation costs are minimized by producing near the market. C) high-income countries are politically stable. D) there are no economies of scale in low-income countries.
Refer to the information provided in Figure 7.4 below to answer the question(s) that follow. 
Figure 7.4Refer to Figure 7.4. The total product of six workers is
A. 5. B. 50. C. 55. D. 60.