° 20 40 60 80 100 120 QUANTITY OF LABOR (Number of workers) Now consider the effects of the wage change on the entire industry. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. WAGE RATE (Dollars per hour) 30 Graph Input Tool ? Wage Rate 15 (Dollars per hour) 25 Supply Quantity 60 Demanded (Thousands of Quantity Supplied (Thousands of workers) 60 20 workers) 15 Excess Supply (Thousands of workers) 0 Shortage 0 (Thousands of workers) 10 Demand Demand Shifter Pro-union Advertising (Millions of dollars) 0 0 120 20 40 60 80 100 QUANTITY OF LABOR (Thousands of workers) The union's wage increase from $15 to $20 per hour causes an excess supply of thousand workers. Suppose that the union, in order to mitigate the unemployment caused by the wage increase, bolsters demand by rolling out a "Buy Union" advertising campaign. If the union spends $5 million on the campaign, the excess supply of labor will be thousand workers.

° 20 40 60 80 100 120 QUANTITY OF LABOR (Number of workers) Now consider the effects of the wage change on the entire industry. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. WAGE RATE (Dollars per hour) 30 Graph Input Tool ? Wage Rate 15 (Dollars per hour) 25 Supply Quantity 60 Demanded (Thousands of Quantity Supplied (Thousands of workers) 60 20 workers) 15 Excess Supply (Thousands of workers) 0 Shortage 0 (Thousands of workers) 10 Demand Demand Shifter Pro-union Advertising (Millions of dollars) 0 0 120 20 40 60 80 100 QUANTITY OF LABOR (Thousands of workers) The union's wage increase from $15 to $20 per hour causes an excess supply of thousand workers. Suppose that the union, in order to mitigate the unemployment caused by the wage increase, bolsters demand by rolling out a "Buy Union" advertising campaign. If the union spends $5 million on the campaign, the excess supply of labor will be thousand workers.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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