Union bargaining power rises with tight labor markets Steps:

• Trade unions gain wage bargaining power when labor demand exceeds supply, making workers scarcer.
• Increasing output signals higher production needs, boosting employer demand for labor.
• This tightens the labor market, giving unions leverage to demand higher wages without replacement threats.
• Conversely, factors increasing labor availability dilute this power.

Why B is correct:

• In labor economics, rising output shifts the labor demand curve rightward (per the demand-supply model), reducing unemployment and enhancing unions' ability to secure wage hikes.

Why the others are wrong:

• A: Rising labor supply shifts the supply curve right, flooding the market and weakening unions' negotiating position.
• C: Rising unemployment signals excess labor supply, making it easier for employers to resist wage demands.
• D: Rising imports heighten foreign competition, reducing domestic labor demand and undermining union influence.

Final answer: B