WAGE The following graph shows the labor market in a state in the East. Suppose the legislature in this state passes strong "right-to-work" laws that make it very difficult for unions to organize workers, so the wage is always equal to the market-clearing value. Assume that with the exception of this difference in legislation, the western and eastern states are extremely similar. The initial position of the graph corresponds to the initial labor market condition in the eastern state before the labor union negotiated the new, higher wage for workers in the western state. Suppose that after the wage goes up in the western state, some workers in the western state lose their jobs and decide to move to the eastern state. Adjust the graph to show what happens to employment and wages in the eastern state. LABOR Supply Demand Demand ° Supply (?) Which of the following groups are better off as a result of the union action in the western state? Check all that apply. Workers in the western state employed at the union wage Employers in the western state Workers who find new jobs in the eastern state The original workers in the eastern state
WAGE The following graph shows the labor market in a state in the East. Suppose the legislature in this state passes strong "right-to-work" laws that make it very difficult for unions to organize workers, so the wage is always equal to the market-clearing value. Assume that with the exception of this difference in legislation, the western and eastern states are extremely similar. The initial position of the graph corresponds to the initial labor market condition in the eastern state before the labor union negotiated the new, higher wage for workers in the western state. Suppose that after the wage goes up in the western state, some workers in the western state lose their jobs and decide to move to the eastern state. Adjust the graph to show what happens to employment and wages in the eastern state. LABOR Supply Demand Demand ° Supply (?) Which of the following groups are better off as a result of the union action in the western state? Check all that apply. Workers in the western state employed at the union wage Employers in the western state Workers who find new jobs in the eastern state The original workers in the eastern state
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:WAGE
The following graph shows the labor market in a state in the East. Suppose the legislature in this state passes strong "right-to-work" laws that make it
very difficult for unions to organize workers, so the wage is always equal to the market-clearing value. Assume that with the exception of this
difference in legislation, the western and eastern states are extremely similar.
The initial position of the graph corresponds to the initial labor market condition in the eastern state before the labor union negotiated the new, higher
wage for workers in the western state.
Suppose that after the wage goes up in the western state, some workers in the western state lose their jobs and decide to move to the eastern state.
Adjust the graph to show what happens to employment and wages in the eastern state.
LABOR
Supply
Demand
Demand
°
Supply
(?)
Which of the following groups are better off as a result of the union action in the western state? Check all that apply.
Workers in the western state employed at the union wage
Employers in the western state
Workers who find new jobs in the eastern state
The original workers in the eastern state
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