A union could raise wages without causing unemployment of union members if it can increase demand for union labor. How might this goal be achieved?
What will be an ideal response?
If unions can increase the labor productivity of the workers, then the demand for labor would increase. Perhaps the union workers are more productive because they don't have to worry about being fired for no cause since the union is looking out for their interests. Perhaps the unions can induce consumers to demand union-made goods through advertising campaigns, or can decrease demand for nonunion made goods by getting tariff legislation passed.
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Use the following graph for a perfectly competitive firm generating a loss in the short run to answer the next question.
Which of the following market changes would allow the firm to earn an economic profit?
A. an increase in the number of firms entering the industry B. a decrease in market demand C. a decrease in the price of the industry's product D. an increase in market demand
Research on the effects of recessions on the real level of GDP shows that
A) recessions cause only temporary reductions in real GDP, which are offset by growth during the expansion phase. B) recessions cause large, permanent reductions in the real level of GDP. C) recessions cause both temporary and permanent declines in real GDP, but most of the decline is temporary. D) recessions cause both temporary and permanent declines in real GDP, but most of the decline is permanent.
The difference between the willingness to sell a good and the price that the seller receives for it is
A. welfare economics. B. consumer surplus. C. willingness to pay. D. producer surplus.
Given the demand curve in this graph, if price were $2.00, how much quantity would be purchased?
A. 1 unit
B. 2 units
C. 3 units
D. 4 units