Show the equilibrium outcome of the wage-setting

Reference no: EM133219398

Question -

(a) Show the equilibrium outcome of the wage-setting, price-setting model of the labor market and provide economic intuition for the model.

(b) Show how the equilibrium real wage and level of employment in this model changes when there is an increase in the power of trade unions. Do the changes in wages and employment seem reasonable to you?

Reference no: EM133219398

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