Suppose that bartenders and waiters have no unions.Now suppose that bartenders form a union.What does this do the labor supply and wages of waiters?
A)Both labor supply and wages increase.
B)Labor supply increases,and wages decrease.
C)Labor supply decreases,and wages increase.
D)Both labor supply and wages decrease.

Question

Quizplus · Accepted Answer

When bartenders form a union, they may negotiate for higher wages, which could lead to a decrease in the number of bartender positions available. Some bartenders might then seek jobs as waiters, increasing the labor supply for waiters. An increase in labor supply, with demand remaining constant, typically leads to a decrease in wages.

Suppose That Bartenders and Waiters Have No Unions