12-1 Explain why the quantity of labor supplied increases with the wage, other things remaining constant (Market Supply of Labor) The following table shows the hours per week supplied to a particular market by three individuals at various wage rates. Calculate the total hours per week (Q,) supplied to the market. 1. Hourly Wage Hours per Week Q, $15 20 16 25 17 35 10 18 45 25 10 19 42 40 30 20 38 37 45 Why does the quantity supplied tend to increase with the hourly wage? Which individuals, if any, have backward- bending supply curves in the wage range shown? Does the market supply curve bend backward in the wage range shown in the table?

12-1 Explain why the quantity of labor supplied increases with the wage, other things remaining constant (Market Supply of Labor) The following table shows the hours per week supplied to a particular market by three individuals at various wage rates. Calculate the total hours per week (Q,) supplied to the market. 1. Hourly Wage Hours per Week Q, $15 20 16 25 17 35 10 18 45 25 10 19 42 40 30 20 38 37 45 Why does the quantity supplied tend to increase with the hourly wage? Which individuals, if any, have backward- bending supply curves in the wage range shown? Does the market supply curve bend backward in the wage range shown in the table?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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2. A manager hires labour and rents capital equipment in a very competitive market. Currently, the wage rate is £6 per hour and capital is rented at £12 per hour. If the marginal product of labour is 50 units of output per hour and the marginal product of capital is 75 units of output per hour, is the firm using the cost-minimising combination of capital and labour? If not, should the firm increase or decrease the amount of capital used in the production process?
Figure 18b This figure below shows the labor market for automobile workers. The curve labeled S is the labor supply curve, and the curves labeled D1 and D2 are the labor demand curves. On the horizontal axis, L represents the quantity of labor in the market. 0 S D₁ What is measured along the vertical axis on the graph? O a. the wage paid to automobile workers O b. time spent by workers producing automobiles O c. the quantity of automobiles produced O d. the price of automobiles L
Town 1 Town 2 30 30 ME, ME, Labor Supply 27 27 24 24 21 21 Labor Supply 18 18 15 12 12 6. Labor Demand Labor Demand 12 3 4S 6 7 LABOR (Hours) 10 2 10 LABOR (Hours) Complete the following table with the profit-maximizing quantity of labor each salon wil hire, along with the wage it wil pay for each hour of labor. Town 1 Town 2 Labor 3 hours v 3 hours v Wage $10.50 V $9.00 In Town 1, the salon pays a wage that is the marginal value product of the final unit of labor hired, whereas In Town 2, the wage is v the marglnal value product of the final unit of labor hired. The outcome in is closer to that of a competitive market, glven that the supply of labor IsM elastic (at the market equilibrium) with respect to changes in the wage.
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Question 3: A firm in a perfectly competitive market must figure out at what level to produce in order to maximize profits. This firm knows that the cost to rent office space for the month will be $3,000 and that each worker will cost $400 a month and the output per worker is given below. Knowing this information fill in the table and show how many workers the firm should hire to produce what quantity of output in order to maximize total profit. Workers Pay Output Price Total Revenue Fixed Cost Var. Cost Total Cost Marg. Cost Marg. Rev Total Profit 400 10 3,000 3,000 -3,000 3 10 1 400 170 1,700 3,000 440 3,440 -1,740 10 2 374 960 3 578 1,560 4 697 2,240 799 3,000
2. The table below shows the number of total products produced by its corresponding number of laborers employed. Assume that each laborer receives P550 as wage and the firm rental fee for the equipment it uses. рays P700 Q0 | 24 64 | 116 176 220 240 248 2 4 8. 10 12 14 A. If the firm wants to minimize the cost per unit of production, how many units of output must it produce? B. If the product is sold for P21, should the seller continue production? If units of output? Justify your answer. C. At what price will the firm decide to shut-down in the short-run? yes, how many
Question 04: Suppose that labor is the only input used by a perfectly competitive firm. To the right is the firm's daily 'production function'. [ See below for the table] (a) Calculate the marginal product, MP, for each additional worker. (b) Each unit of output sells for $10. Calculate the marginal revenue product of each worker. Quantity of labor 0 1 2 3 4 5 6 7 Total Product 0 8 15 21 26 30 33 3.5 MP MRP @if MR = $10 MRP @ if MR = $12 A) The MP of the 2nd worker is 8 widgets and the MRP of the 4th worker is $60. B) The MP of the 2nd worker is 7 widgets and the MRP of the 4th worker is $40. C) The MP of the 2nd worker is 7 widgets and the MRP of the 4th worker is $50. D) The MP of the 2nd worker is 6 widgets and the MRP of the 4th worker is $60.
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Ford Motors 2010-2019 How does the type of labor used (high-skilled or low-skilled) impact the supply of labor? How do these influence the wage rate in the company?
5. Discrimination in the labor market The following table lists the name, gender, height, and minimum wage 10 people are willing to accept to work as personal assistants at a prestigious law firm. Height Minimum Wage Name Gender (Inches) (Dollars per week) Paolo 67 $308 Latasha F 63 $321 Rosa 66 $342 Jake M 71 $364 Nick M 69 $385 Alyssa F 66 $407 Tim M 70 $421 Edison M 70 $450 Brian M 64 $462 Crystal 69 $484 The lowest wage that the law firm can pay to hire five personal assistants is per week. Suppose the head of the law firm has a preference for tall employees because he thinks it will increase revenue, and thus, he imposes the restriction that all personal assistants hired must be at least 67 inches in height. Under this new regulation, the wage rate the law firm must pay to attract five personal assistants rises by $ |per week.
5. Consider the market for labor. When you draw a supply and demand curve, what group of people represent “supply”? Explain.
11. Describe what happens to quantity of labor supplied when wages are at the equilibrium level, above equilibrium, and below equilibrium.