Q1. Suppose that an industrial union’s primary purpose is to increase the wages of its members above the competitive level.
a) Describe on a theoretical level how this raise might be achieved.
b) What conditions would make the union's job simpler?
Q2. Assume that a frost kills a big part of an orange crop, with a resultant higher price of oranges. It has been stated that such a raise in price profits no one since it can’t elicit a supply response; the higher price, it is stated, simply ‘lines the pockets of profiteers’. Analyze this proposition.
Q3. The average wage rate of women is just 59% of that of men. This exhibits that women are paid just 59 percent as much as men for doing the similar work. Assess this statement.
Q4. What is wrong with this manner of thinking?
Higher wages help everyone. Workers are helped as they can now purchase more of the things they require. Business is helped as the raise in worker’s purchasing power will raise the demand for products. Taxpayers are helped as workers will now pay more taxes. The union activities and legislation mandating higher wages for workers will encourage economic growth.
Q5. Jobs are the key to economic growth. Unless we create additional jobs, our standard of living will fall. (State true or false and describe why?)