What are the optimal wage and employment level from the perspective of a union in Figure 31.1?
A)$11;32 workers.
B)$5;16 workers.
C)$4;13 workers.
D)$8;10 workers.

Question

What are the optimal wage and employment level from the perspective of a union in Figure 31.1?
A)$11;32 workers. 
B)$5;16 workers. 
C)$4;13 workers. 
D)$8;10 workers.

Quizplus · Accepted Answer

The optimal wage and employment level from the perspective of a union is at the point where their marginal revenue product (MRP) equals their marginal cost (MC). In the graph, this occurs when the wage is $8 and the employment level is 10 workers (point C). At this point, the MRP is equal to the wage rate so the union is able to maximize their total revenue while also maximizing employment for their members. Therefore, choice D is the correct answer.

What Are the Optimal Wage and Employment Level from the Perspective