For a union to be successful in increasing the total wage bill received by its members by forcing up the wage rate, the demand curve for labor needs to be
A)elastic.
B)perfectly elastic.
C)unitary elastic.
D)inelastic.

Question

Quizplus · Accepted Answer

For a union to successfully increase the total wage bill by pushing up the wage rate, the demand for labor must be inelastic. This means that employers are relatively unresponsive to wage increases, so a higher wage does not lead to a significant reduction in the quantity of labor demanded. If the demand were elastic, a rise in wages would cause a large decrease in the quantity of labor demanded, potentially reducing the total wage bill.

For a Union to Be Successful in Increasing the Total