Which cause of unemployment is associated with a wage rate above the market equilibrium level?
A) mismatch between skills and available jobs
B) economic recession
C) sectoral changes
D) unions

Question

Quizplus · Accepted Answer

Unions can negotiate wage rates above the market equilibrium level, which can lead to a surplus of labor (unemployment) as employers are not able to hire all the workers willing to work at that higher wage rate.

Which Cause of Unemployment Is Associated with a Wage Rate