Unions contribute to structural unemployment when collective bargaining results in wages:
A) above the equilibrium level.
B) below the minimum wage.
C) below the equilibrium level.
D) above the level of employment insurance benefits.

Question

Quizplus · Accepted Answer

When unions negotiate wages above the equilibrium level, it can lead to structural unemployment as employers may hire fewer workers at the higher wage rate.

Unions Contribute to Structural Unemployment When Collective Bargaining Results in Wages