### Minimum-wage laws and unemploymentConsider the labor market defined by the supply and demand curves plotted on the following graph.Use the calculator to help you answer the following questions. You will not be graded on any changes you make to the calculator.**Graph Input Tool**#### Market for Labor- **Wage (Dollars per hour):** 3.00- **Labor Demanded (Thousands of workers):** 1,050- **Labor Supplied (Thousands of workers):** 150**Graph Explanation:**The graph depicts the labor market with the wage rate on the y-axis (ranging from $0 to $24 per hour) and the quantity of labor on the x-axis (ranging from 0 to 1200 thousand workers).- The **Supply curve** slopes upward from left to right, indicating that as the wage rate increases, the quantity of labor supplied increases.- The **Demand curve** slopes downward from left to right, suggesting that as the wage rate increases, the quantity of labor demanded decreases.At a wage rate of $3.00 per hour:- The number of workers demanded is 1,050,000.- The number of workers supplied is 150,000.This graph shows an imbalance in the market, where the quantity of labor supplied is less than the quantity demanded at the given wage rate.### Summary:- **Wage Rate:** $3.00 per hour- **Labor Demanded:** 1,050,000 workers- **Labor Supplied:** 150,000 workersThe discrepancy between labor demanded and labor supplied indicates a potential shortage of labor at the current wage rate. **Understanding Labor Supply and Demand at a Minimum Wage**Complete the following table with the quantity of labor supplied and demanded if the wage is set at $15.00. Then indicate whether this wage will result in a shortage or a surplus.**Hint:** Be sure to pay attention to the units used on the graph and in the table. For example, type in 100 for 100,000 workers.| Wage (Thousands of workers) | Labor Demanded (Thousands of workers) | Labor Supplied (Thousands of workers) | Shortage or Surplus? ||-----------------------------|---------------------------------------|---------------------------------------|----------------------|| $15.00 | | | |Suppose the federal government contemplates a new law that would create a national minimum wage of $15.00 per hour.Which of the following statements are true? Check all that apply.- [ ] If the minimum wage is set at $15.00, the market will not reach equilibrium.- [ ] In this labor market, a minimum wage of $11.50 would be binding.- [ ] In the absence of price controls, a surplus puts downward pressure on wages until they fall to the equilibrium.- [ ] Binding minimum wages cause structural unemployment.

A firm’s willingness to pay for each unit of labor it wishes to hire is shown by the labor demand…

Complete the following table with the quantity of labor supplied and demanded if the wage is set at $15.00. Then indicate whether this wage will result in a shortage or a surplus. Hint: Be sure to pay attention to the units used on the graph and in the table. For example, type in 100 for 100,000 workers. Labor Supplied (Thousands of workers) Shortage or Surplus? Labor Demanded Wage (Thousands of workers) $15.00 Suppose the federal government contemplates a new law that would create a national minimum wage of $15.00 per hour. Which of the following statements are true? Check all that apply. If the minimum wage is set at $15.00, the market will not reach equilibrium. In this labor market, a minimum wage of $11.50 would be binding. In the absence of price controls, a surplus puts downward pressure on wages until they fall to the equilibrium. Binding minimum wages cause structural unemployment.

Complete the following table with the quantity of labor supplied and demanded if the wage is set at $15.00. Then indicate whether this wage will result in a shortage or a surplus. Hint: Be sure to pay attention to the units used on the graph and in the table. For example, type in 100 for 100,000 workers. Labor Supplied (Thousands of workers) Shortage or Surplus? Labor Demanded Wage (Thousands of workers) $15.00 Suppose the federal government contemplates a new law that would create a national minimum wage of $15.00 per hour. Which of the following statements are true? Check all that apply. If the minimum wage is set at $15.00, the market will not reach equilibrium. In this labor market, a minimum wage of $11.50 would be binding. In the absence of price controls, a surplus puts downward pressure on wages until they fall to the equilibrium. Binding minimum wages cause structural unemployment.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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