21 DQuestion 21Which of the following statements is NOT correct?Most workers in the U.S. economy are not members of a union.O Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint marketpower.When a union is present in a labor market, wages are not determined by the equilibrium of supply anddemand.O The process by which unions and firms agree on the terms of employment is called a strike.

Question 21 Which of the following statements is NOT correct? O Most workers in the U.S. economy are not members of a union. Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint market power. O When a union is present in a labor market, wages are not determined by the equilibrium of supply and demand. O The process by which unions and firms agree on the terms of employment is called a strike.

Question 21 Which of the following statements is NOT correct? O Most workers in the U.S. economy are not members of a union. Like any cartel, a union is a group of sellers acting together in the hope of exerting their joint market power. O When a union is present in a labor market, wages are not determined by the equilibrium of supply and demand. O The process by which unions and firms agree on the terms of employment is called a strike.

Microeconomics: Principles & Policy

14th Edition

ISBN:9781337794992

Author:William J. Baumol, Alan S. Blinder, John L. Solow

Publisher:William J. Baumol, Alan S. Blinder, John L. Solow

Chapter19: Labor And Entrepreneurship: The Human Inputs

Section: Chapter Questions

Problem 1DQ

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Table 14.12 shows the quantity demanded and supplied in the labor market for driving city buses in the town of Unionville, where all the bus drivers belong to a union. What would the equilibrium wage and quantity be in this market if no union existed? Assume that the union has enough negotiating power to raise the wage to 4 per hour higher than it would otherwise be. Is there now excess demand or excess supply of labor?
The demand for unionized labor will generally be more elastic, and it will be more difficult for the union to achieve above-equilibrium wages, when: O there are few close substitutes for the unionized workers. O trade barriers limit the importation of the product produced by the unionized workers. O the cost of employing the unionized workers is a small part of the total cost of product that they produce. the demand for the product produced by the unionized workers is relatively price elastic. A strike, or the threat of one, is most likely to be effective when: O demand for the firm's product is weak. O foreign competition for the product is high. O the firm has a low product inventory. O demand for the product produced by the union workers is highly elastic.
Suppose the union’s resistance curve is summarized by the following data. The union’s initial wage demand is $10 per hour. If a strike occurs, the wage demands change as follows:Length of Strike: Hourly Wage Demanded1 month $92 months 83 months 74 months 65 or more months 5Consider the following changes to the union resistance curve and state whether the proposed change makes a strike more likely to occur, and whether, if a strike occurs, it is a longer strike.a. The drop in the wage demand from $10 to $5 per hour occurs within the span of two months, as opposed to five months.b. The union is willing to moderate its wage demands further after the strike has lasted for six months. In particular, the wage demand keeps dropping to $4 in the sixth…
The following table provides information about labor supply and the marginal revenue product of labor for a profit-maximizing monopsonist. Marginal Revenue Wage Labor Supply Product of Labor 4567∞ a 18 36 19 33 20 30 21 27 8 22 24 9 23 21 10 13 223 24 18 11 25 15 12 26 12 27 9 14 28 6 15 29 3 Calculate the marginal cost of labor at each level of employment. What is the marginal cost of hiring the 25th worker?
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Figure 19-7 30 Wage $2 27 24 21+ 18 15 12 9 6. 3 D1 200 400 600 800 Iabor Refer to Figure 19-7. The figure shows labor demand and labor supply in a non-unionized labor market. Suppose the current labor demand is D1 and the current labor supply is S1. If a firm in this market decided to pay its workers $18 per hour to increase the productivity of its workers, this firm would be paying a(n)
6. Contrasting labor union laws in two states Consider two states that adopt different laws conceming labor unions. The following graph shows the labor market in a state in the North. Initlally, the market-dearing wage there is $8.00 per hour. Suppose that the legislature in this northem state passes laws that make it easy for workers to join a union. Through collective bargalning, the union negotiates a wage of $10.00 per hour. Use the graph Input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Graph Input Tool Market for Labor 16 Wage (Dollars per hour) 14 Supply 2.00 Labor Demanded (Thousands of workers) 12 Labor Supplied (Thousands of workers) 1,400 200 10 Demand 2 200 400 600 800 1000 1200 1400 1600 LABOR (Thousands of workers) Enter $10.00 Into the box labeled WVage on the previous graph. Hint: Be sure to pay attention to the units used on the graph. At the union wage, union workers will be employed. The following…
Briefly describe "social movement" unionism. Discuss whether, in your judgment, the changes proposed by advocates of "social movement" unionism would result in significantly changed conditions for U.S. workers.
Part I: Suppose the firm's labor demand curve is given by: w = 60 – 0.03E where w is the hourly wage andE is the level of employment. Suppose also that the union's utility function is given by: U = w x E The marginal utility of the wage for the union is E and the marginal utility of employment is w. (a) How many workers will be employed under a monopoly union contract? (b) What wage would a monopoly union demand?
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How to calculate the percentage of decline in national income resulting from misallocation of labor in a model of monopoly unionism? And how to discuss the both unions and firms can be better off if they move off the demand curve? Give some example of derive the contract curve. What is the difference between efficient contracts and strongly efficient contracts ? Discuss the application of Hicks Paradox. What is the labor strike and how does it affect the business of the firm? Identify and explain the different catergoties of labor strike.