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1. Consider a firm that produces dog beds. Suppose all of the workers in the fir

ID: 1100097 • Letter: 1

Question

1. Consider a firm that produces dog beds. Suppose all of the workers in the firm get together and form a union. (Assume that the firm cannot hire non-union workers.) Given your knowledge of the impact of unions, what is likely to occur as a result of the formation of a union (as compared to before when there was no union)?     

A. Workers' wages will fall and less workers will be employed by the firm.
B. Workers' wages will rise and less workers will be employed by the firm.
C. Workers' wages will rise and more workers will be employed by the firm.
D. Workers' wages will fall and more workers will be employed by the firm.

2. Which of the following is NOT a piece of legislation that deals with labor unions in the United States?     
         
A. The Federal Trade Commission Act.
B. The National Labor Relations Act (Wagner Act, 1935).
C. All of the above are laws that deal with labor unions.
D. The Taft-Hartley Act (1947) which gives employers certain rights.

3. Which statement is true?

Statement 1: The strike is the ultimate weapon of a union. Statement 2: A firm that manufactures furniture would be better able to withstand a strike than a firm that produces fresh fruits/vegetables.

Explanation / Answer

B. Workers' wages will rise and less workers will be employed by the firm.

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D. The Taft-Hartley Act (1947) which gives employers certain rights.