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Consider a Wage- Setting Union in an Otherwise Competitive Labour

Question 84

Multiple Choice

Consider a wage- setting union in an otherwise competitive labour market. If the union sets a wage above the competitive level, the effect will be


A) to create a group of workers who would like to obtain jobs in the industry but cannot do so.
B) to cause the labour supply curve to shift to the right.
C) to increase the amount of employment in the industry.
D) a level of employment which is the same as that at the competitive equilibrium wage.
E) to raise wages for all workers who wish to work in the industry.

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