(3) Consider the following figure about the real price of oil. Real price of oil 90 Start of pandemic (Lockdown) 80 70 60 50 Pre-pandemic 40 30 20 10 The figure above shows the evolution of the real price of oil in the United States between January 2019 and February 2022. The price hit bottom in April 2020 after the COVID-19 lockdown in March 2020. Since then, the price has been increasing and surpassed the pre- pandemic level. What would happen to real wages and employment in the labor market model due to the increase in oil price? Explain using the labor supply and demand diagram. 2019/1 4 9. 12 2020/1 7. 6° OT 2021/1 6. от 12 2022/1
(3) Consider the following figure about the real price of oil. Real price of oil 90 Start of pandemic (Lockdown) 80 70 60 50 Pre-pandemic 40 30 20 10 The figure above shows the evolution of the real price of oil in the United States between January 2019 and February 2022. The price hit bottom in April 2020 after the COVID-19 lockdown in March 2020. Since then, the price has been increasing and surpassed the pre- pandemic level. What would happen to real wages and employment in the labor market model due to the increase in oil price? Explain using the labor supply and demand diagram. 2019/1 4 9. 12 2020/1 7. 6° OT 2021/1 6. от 12 2022/1
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:(3) Consider the following figure about the real price of oil.
Real price of oil
90
Start of pandemic (Lockdown)
80
70
60
50
Pre-pandemic
40
30
20
10
The figure above shows the evolution of the real price of oil in the United States between
January 2019 and February 2022. The price hit bottom in April 2020 after the COVID-19
lockdown in March 2020. Since then, the price has been increasing and surpassed the pre-
pandemic level. What would happen to real wages and employment in the labor market model
due to the increase in oil price? Explain using the labor supply and demand diagram.
2019/1
9.
7.
12
2020/1
E.
7.
8.
5.
12
2022/1
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