Why does the International Ladies' Garment Workers Union pay for advertising that promotes American- made textile products?
If this advertising is successful, it will increase the demand for American-made textiles, leading to higher
textile prices. This will increase the MRP of the workers who produce these textiles, who also are members
of the ILGWU. An increase in their MRP will induce textile firms to hire more workers and/or pay higher
wages. The union, of course, will bargain for wage gains for its existing members.
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A situation in which a bidder over-values an auction item and is worse off because their bid is too high is known as the:
A) Ellsberg Paradox. B) winner's curse. C) Arrow Impossibility Theorem. D) curse of the commons.
All of the following are examples of spending on goods and services in the circular flow model except
A) Giovani buys a new cell phone to replace the one he flushed down the toilet. B) Amir buys a new humidor for his cigar shop. C) Isabella buys the sushi plate for lunch at the Turning Japanese Sushi Bar. D) Vijay buys a new minivan for his family's cross-country vacation.
A consumer is in equilibrium if he or she derives the same
A. total utility from each good consumed. B. total utility per dollar spent on each good consumed. C. marginal utility from each good consumed. D. marginal utility per dollar spent on each good consumed.
Regulators often raise prices instead of lowering them. This is designed to
A. prevent the exit of competitors. B. protect the consumer from cheap products. C. ensure high-quality products. D. ensure workers are adequately paid.