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1-1 LOCAL 635 forget that when the worker finishes his or her meal,
someone has to clean up. That costs money too. When
Local 635 represents kitchen workers at ho- you add up all of these items, a prime rib dinner easily
tels in several Midwestern cities. Part of adds up to $15!"
their labor agreement states that
workers "shall receive one meal
free Required
per shift up to a cost of $8, with any a. examples of costs, at the Riverside Hotel, that
List
cost over $8 being deducted from wages are variable, fixed, and sunk. Provide an example of an
paid to said employee." opportunity cost.
A labor dispute arose at the River- b. What is the source of conflict between labor and
side Hotel shortly after itwas opened in management? What changes would you recommend
June. Kitchen workers who ate dinner on the wording of the labor agreement?
in the
late shift found that their wages were reduced by
$7 for each meal they consumed at the hotel dur-