If a Firm Operates in a Competitive Output Market, Then

Multiple Choice

If a firm operates in a competitive output market, then the higher wages negotiated by a union must:

A) lead to a Pareto-efficient contractl
B) cause it to pass on the cost of the higher wages to its customers in the form of higher product prices.
C) reduce the level of employment at the firm.
D) push the firm off of its labour demand curve and onto the contract curve.
E) increase the level of employment at the firm.