Assume that the United Steel Workers negotiate a contract resulting in a higher wage rate. The total wages earned by members of the union would increase if the elasticity of demand for labor equals

Question

Quizplus · Accepted Answer

When the elasticity of demand for labor is less than 1 (inelastic), an increase in wage rates leads to a less than proportionate decrease in the quantity of labor demanded, resulting in an increase in total wages earned by the workers.

Assume That the United Steel Workers Negotiate a Contract Resulting