If labor union leaders believe that the Fed is more inclined to fight unemployment than keep inflation in check, then they are more likely to:
A) demand a wage decrease.
B) demand a wage hike.
C) demand an increase in the number of work days for the same wage.
D) not demand a wage hike.

Question

Quizplus · Accepted Answer

Labor union leaders would be more likely to demand a wage hike if they believe the Fed is more inclined to fight unemployment than keep inflation in check. This is because a decrease in unemployment would create a tighter labor market, giving unions more bargaining power in negotiations for higher wages.

If Labor Union Leaders Believe That the Fed Is More