If an industrial union would strike if it does not receive a particular wage rate, then the supply curve of labor in this market
a. is horizontal at that particular wage rate until it intersects the original supply of labor curve
b. is vertical at that particular wage rate until it intersects the original supply of labor curve
c. shifts to the left
d. disappears
e. slopes downward
Question 2
The opportunity cost of producing one car in Germany is 2,000 bushels of wheat, and the opportunity cost of producing one car in Canada is 1,200 bushels of wheat. The two countries can realize mutual gains from trade if they agree on terms of trade that are
a. greater than 2,000 bushels of wheat per car
b. less than 1,200 bushels of wheat per car
c. greater than 1,200 bushels of wheat per car and less than 2,000 bushels of wheat per car, and Germany produces wheat
d. greater than 1,200 bushels of wheat per car and less than 2,000 bushels of wheat per car, and Germany produces cars
e. greater than 1,200 bushels of wheat per car and less than 2,000 bushels of wheat per car, and each country produces both goods
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