refer to the following diagram, in which EC is the employer concession curve and UR is the union resistance curve.

-The model assumes that,as the expected length of a strike increases:
A)union wage demands fall and firm wage concessions increase
B)uncertainty about the union's resistance and the employer's concessions decreases
C)union wage demands increase and firm wage concessions decrease
D)uncertainty about the union's resistance and the employer's concessions increases

Question

refer to the following diagram, in which EC is the employer concession curve and UR is the union resistance curve.

-The model assumes that,as the expected length of a strike increases:
A)union wage demands fall and firm wage concessions increase 
B)uncertainty about the union's resistance and the employer's concessions decreases 
C)union wage demands increase and firm wage concessions decrease 
D)uncertainty about the union's resistance and the employer's concessions increases

Quizplus · Accepted Answer

As the expected length of a strike increases, union wage demands increase and firm wage concessions decrease. This is because the longer a strike is expected to last, the more costly it will be for both the union and the firm. The union will be less willing to accept a low wage offer, and the firm will be less willing to concede to a high wage demand.

Refer to the Following Diagram, in Which EC Is the Employer