Question : 91) Refer to Figure 14-6. The market begins in equilibrium : 1384293

 

91) Refer to Figure 14-6. The market begins in equilibrium with the curves labelled Demand and Supply. If a labour union negotiates the wage to W2, the difference between this wage and the competitive equilibrium wage is called

A) the industry’s wage premium.

B) the union wage premium.

C) a temporary wage differential.

D) a discrimination differential.

E) a legislated wage differential.

92)  Refer to Figure 14-6. The market begins in equilibrium with the curves labelled Demand and Supply. If a labour union negotiates the wage to W2 in an otherwise competitive labour market,

A) the supply of labour will stay the same.

B) employers will hire L2 quantity of labour.

C) the demand for labour will shift to D2.

D) employers will hire L1 quantity of labour.

E) equilibrium will occur at W1 and L2.

93) Refer to Figure 14-6. Suppose a labour union is operating in this labour market. The practice of “feather-bedding” would be illustrated by

A) employers hiring L1 units of labour because a union organizes workers.

B) employers hiring L2 units of labour when a union has been able to increase the wage to W2.

C) the supply of labour shifting to S2.

D) advertising causing the demand for labour to shift to D2.

E) the union wage premium equal to the difference between W1 and W2.

94) Economists observe clear evidence of a union wage premium but do not observe the clear union effect on employment levels predicted from theory. One explanation for this is

A) that the labour supply curve shifts to the right in the collective bargaining process, thereby eliminating any employment effect.

B) that the labour supply curve, in the presence of a union, is very inelastic, which implies only a very small effect on employment.

C) that union-based advertising for the product increases demand for the product, shifts the demand curve to the right and eliminates any employment effect.

D) the union’s ability, through the collective bargaining process, to pressure firms to hire more workers than they otherwise would at the union wage.

E) both C and D are correct.

95) If a wage-setting union enters a monopsonistic labour market, the union can cause

A) wages to rise to what would have been the competitive level but no higher.

B) wages to rise above the level set by the monopsonist, but only if it allows employment to fall below the level set by the monopsonist.

C) both wages and employment to rise over the monopsonistic level.

D) wages or employment to rise above the level set by the monopsonist, but not both.

E) the level of non-wage benefits to rise but cannot affect either wages or employment.

96) If a union succeeds in shifting the labour supply curve to the left, it can achieve wages above the

A) competitive level and all workers will gain.

B) equilibrium level and an increase in employment.

C) equilibrium level without affecting employment.

D) competitive level but will reduce the level of employment.

E) competitive level without a pool of unemployed workers seeking to work at the higher wage.

97) The fundamental dilemma facing labour unions is

A) job security versus worker safety.

B) wage increases versus employment growth.

C) wage increases versus publicly provided pensions.

D) members’ roles as workers versus their roles as consumers.

E) “featherbedding” versus the union-wage premium.

98) Unions currently represent ________ employed workers in Canada.

A) all of the

B) half of the

C) more than 50% of

D) approximately 30% of

E) less than 10% of

99) Unions currently represent ________ government employees in Canada.

A) all of the

B) approximately half of the

C) over 70% of

D) less than 30% of

E) less than 10% of

100) The average union wage premium in Canada is

A) less than 10%.

B) between 10 and 15%.

C) between 15 and 30%.

D) between 30 and 50%.

E) more than 50%.

 

 

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