Suppose that management and labor are bargaining over the distribution of excess profits amounting to $200 per worker.
Suppose that management and labor are bargaining over the distribution of excess profits amounting to $200 per worker. Suppose that failure to reach an agreement an agreement reduces management’s share of the surplus by 5 percent per round and reduces labor’s share of the surplus by 7 percent per round. There is a potentially unlimited number of negotiating rounds and labor makes the First offer. How muchof the excess profits will go to labor?
A. $114
B. $86
C. $130
D. $70
E. $55
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