Suppose there is a competitive market for retail workers at a large shopping mall that is large enough to constitute its own labour market. The labour demand curve is QD = 1000 - 20(w) . The labour supply curve is QS = 400 + 40(w) . Suppose that a union now successfully organizes the workers at this mall and obtains a wage rate of $11 (but does not affect the demand curve) . One result is
A) a decrease in employment of 20 workers.
B) a decrease in employment of 60 workers.
C) an increase in employment of 40 workers.
D) an increase in employment of 20 workers.
E) a decrease in employment of 40 workers.
Correct Answer:
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