For each of the proposals, use the previous graph to determine the new number of laboratory aides hired. Then compute the after-tax amount paid by employers (that is, the wage paid to workers plus any taxes collected from the employers) and the after-tax amount earned by laboratory aides (that is, the wage received by workers minus any taxes collected from the workers). Tax Proposal Levied on Employers (Dollars per hour) 2 0 Levied on Workers (Dollars per hour) 0 2 Quantity Hired (Number of workers) After-Tax Wage Paid by Employers (Dollars per hour) After-Tax Wage Received by Workers (Dollars per hour)

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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on Employers field (initially set at zero dollars per nour) shirts the demand curve down by the
amount you enter, and entering a number into the Tax Levied on Workers field (initially set at zero
dollars per hour) shifts the supply curve up by the amount you enter. To determine the before-tax
wage for each tax proposal, adjust the amount in the Wage field until the quantity of labor
supplied equals the quantity of labor demanded. 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 (Dollars per hour)
20
18
16
14
12
10
8
0
Supply
0 10 20 30 40 50 60 70 80 90 100
LABOR (Number of workers)
Tax Proposal
Demand
D-Tax
Levied on
Employers
(Dollars per
hour)
2
0
1
Graph Input Tool
Market for Laboratory Aides
Wage
(Dollars per
hour)
Labor
Levied on
Workers
(Dollars
per hour)
0
2
1
Demanded
(Number of
workers)
Quantity
Hired
(Number of
workers)
Demand Shifter
Tax Levied
on
Employers
(Dollars per
hour)
2
80
2
Supply Shifter
Tax Levied
on Workers
(Dollars per
hour)
For each of the proposals, use the previous graph to determine the new number of laboratory
aides hired. Then compute the after-tax amount paid by employers (that is, the wage paid to
workers plus any taxes collected from the employers) and the after-tax amount earned by
laboratory aides (that is, the wage received by workers minus any taxes collected from the
workers).
Labor
Supplied
(Number of
workers)
After-Tax Wage Paid
by Employers
(Dollars per hour)
(?)
o The proposal in which the entire tax is collected from workers
o The proposal in which the tax is collected from each side evenly
o The proposal in which the tax is collected from employers
O None of the proposals is better than the others
10
0
After-Tax Wage
Received by Workers
(Dollars per hour)
Suppose the government is concerned that laboratory aides already make too little money and,
therefore, wants to minimize the share of the tax paid by employees. Of the three tax proposals,
which is best for accomplishing this goal?
Transcribed Image Text:on Employers field (initially set at zero dollars per nour) shirts the demand curve down by the amount you enter, and entering a number into the Tax Levied on Workers field (initially set at zero dollars per hour) shifts the supply curve up by the amount you enter. To determine the before-tax wage for each tax proposal, adjust the amount in the Wage field until the quantity of labor supplied equals the quantity of labor demanded. 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 (Dollars per hour) 20 18 16 14 12 10 8 0 Supply 0 10 20 30 40 50 60 70 80 90 100 LABOR (Number of workers) Tax Proposal Demand D-Tax Levied on Employers (Dollars per hour) 2 0 1 Graph Input Tool Market for Laboratory Aides Wage (Dollars per hour) Labor Levied on Workers (Dollars per hour) 0 2 1 Demanded (Number of workers) Quantity Hired (Number of workers) Demand Shifter Tax Levied on Employers (Dollars per hour) 2 80 2 Supply Shifter Tax Levied on Workers (Dollars per hour) For each of the proposals, use the previous graph to determine the new number of laboratory aides hired. Then compute the after-tax amount paid by employers (that is, the wage paid to workers plus any taxes collected from the employers) and the after-tax amount earned by laboratory aides (that is, the wage received by workers minus any taxes collected from the workers). Labor Supplied (Number of workers) After-Tax Wage Paid by Employers (Dollars per hour) (?) o The proposal in which the entire tax is collected from workers o The proposal in which the tax is collected from each side evenly o The proposal in which the tax is collected from employers O None of the proposals is better than the others 10 0 After-Tax Wage Received by Workers (Dollars per hour) Suppose the government is concerned that laboratory aides already make too little money and, therefore, wants to minimize the share of the tax paid by employees. Of the three tax proposals, which is best for accomplishing this goal?
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