Exhibit 12-7 reflects which of the following? A. A union that is restricting the

Question

Exhibit 12-7 reflects which of the following? A. A union that is restricting the supply of labor. B. A firm that is restricting the number of job openings. C. The price of the good produced by this labor is rising. D. The price of the good produces by this labor is falling. E. The union that is creating an excess supply of labor. QUESTION 5 Exhibit 12-7 Wage rate 1 Labor/t Exhibit 12-7 reflects which of the following? A union that is restricting the supply of labor A fim that is restricting the number of job openings The price of the good produced by this iabor is rising The price of the pood produced by this labor is ailing The union that is creating an excess supply of labor QUESTION 6

Explanation / Answer

Correct option is (A).

When a union restricts labor supply, the supply of labor decreases, shifting labor supply curve leftward. Note that options (B), (C) & (D) relate to labor demand only. Option (E) keeps demand & supply curves unchanged, and puts a minimum wage above equilibrium wage rate in order to create an excess supply of labor.

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