If labor supply is perfectly inelastic, the imposing a payroll tax that will be split between employers and employees will a) reduce employment. b) leave employment levels unchanged. c) cause the tax burden to fall exclusively on firms. d) cause the tax burden to fall exclusively on workers.

If labor supply is perfectly inelastic, the imposing a payroll tax that will be split between employers and employees will a) reduce employment. b) leave employment levels unchanged. c) cause the tax burden to fall exclusively on firms. d) cause the tax burden to fall exclusively on workers.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter11: Labor Markets

Section: Chapter Questions

Problem 4SQ

See similar textbooks

Related questions

Q: At a price of $5/hour, Bob wants to hire three workers. When the price rises to $7/hour, Bob wants…

A: Price elasticity of demand refers to the responsiveness of quantity demanded to a change in the…

Q: If domestic income is $13,000 million, compensation of employees is $2000 million and mixed income…

A: The Given information is as follows:- Domestic income = $13,000 Compensation of employees = $2000…

Q: Consider the labour markets for skilled labour and unskilled labour. The labour demand curve for…

A: The labor market implies the situation in which the employers and laborers negotiate for employment…

Q: For each of the proposals, use the previous graph to determine the new number of laboratory aides…

A: Demand-supply equilibrium:The demand function reflects an individual’s willingness to pay for each…

Q: A company has 700 employees who work 140 hours a month each. Each worker earns $37 per hour. There…

A: Given, Present employees = 700 Work per month = 140 hours/month Wages = $37/month Additional working…

Q: which of the following will not result in leftward shift of the market demand curve for labor?…

A: The demand curve of labour depicts the desire of the firms to employ a specific quantity of labour…

Q: The wage an employer will pay is limited by Question 4 options: how much the employer likes…

A: The wage rate that an employer pays depends on one very important factor.

Q: The market labor supply curve is typically: perfectly inelastic. downward sloping. upward…

A: Economics refers to the study of scarcity and its implications for the use of resources, production…

Q: darsh is tasked with projecting financial compensation policy strategies for new hires in his…

A: The labor market, frequently alluded to as the job market, alludes to the supply and demand for…

Q: After hiring the third emplyee, John was able to produce 110 units instead of 80 units without the…

A: Marginal product is the change in total product due to an additional input used. Marginal revenue…

Question

If labor supply is perfectly inelastic, the imposing a payroll tax that will be split between employers and employees will

a) reduce employment.

b) leave employment levels unchanged.

c) cause the tax burden to fall exclusively on firms.

d) cause the tax burden to fall exclusively on workers.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Suppose a firm purchases labor in a competitive labor market and sells it product in a competitive product market. The firm's elasticity of demand for labor is -2.50. Suppose the wage increases by 4%. By what percentage will the quantity of labor hired by the firm change? Show your work.
If the price elasticity of demand for labor is 0.2 and the wage increased from $11 to $16 an hour, what is the predicted decrease in the level of employment in percentage terms?
Explain the relationship between the own-wage elasticity of labor demand and output demand elasticity. labour costs as a share of total costs of production.
Suppose a firm purchases labor in a competitive labor market and sells its product in a competitive product market. The firm’s elasticity of demand for labor is -0.4. Suppose the wage increases by 5 percent. What will happen to the number of workers hired by the firm? What will happen to the marginal productivity of the last worker hired by the firm?
If the price of a good increases, then in the market for the type of labor needed to produce this good, Group of answer choices employment will decrease. the labor supply will increase. the marginal product (MP) of labor will increase. the marginal revenue product (MRP) of labor will increas
As the elasticity of demand for labor increases, the more likely a labor union will: place its support behind the right-to-work laws. try to increase wages by reducing the supply of labor. require longer and longer apprenticeship and training programs in order to supply highly skilled workers. try to protect and maintain the current level of employment among its members and place less emphasis on increasing wages.
If older workers have a tax elasticity of labor supply equal to 0.55, by how much will their work activity decline when they reach the Social Security earnings test limit (.e.. wage ceiling)? Recall that the Social Security earnings test limit says that Social Security benefits will be reduced by 50 cents for every additional $1 earned after the wage ceiling. Instructions: Enter your response as a positive percentage rounded to one decimal place. Do not include a negative sign with your answer
Q47 In the Canadian labour market, demand for labour can be impacted by elasticity of the product in which labour is an input. Assume that the coefficient of elasticity of product demand in Canada is 2.4 in industry A (cannabis sector) and is 0.8 in industry B (fertilizer industry). Other things equal, labour demand will be Multiple Choice relatively elastic in both industries A and B. more elastic in industry B than in A. constant in both industries A and B. more elastic in industry A than in B. relatively inelastic in both industries A and B.
Q8 In the Canadian labour market, demand for labour can be impacted by elasticity of the product in which labour is an input. Suppose that the labour cost to total cost ratio in industry A (cannabis sector) is 14 percent, while in industry B (fertilizer sector) it is 68 percent. Other things equal, labour demand will be Multiple Choice more elastic in industry B than in A. constant in both industries A and B. relatively elastic in both industries A and B. relatively inelastic in both industries A and B. more elastic in industry A than in B.
which of the following will not result in leftward shift of the market demand curve for labor? decrease in demand for the firm products increase in the wage decrease in the firm decrease in labor productivity
When hiring additional workers, a firm operating in a perfectly competitive labor market will have to offer higher wages to hire additional workers, and the old workers will also receive the new, higher wage. be able to hire additional workers at lower wages because the new workers have been unemployed. be able to hire additional workers without offering higher wages. have to offer higher wages to hire additional workers, but the old workers do not get the higher wage.
At a price of $5/hour, Bob wants to hire three workers. When the price rises to $7/hour, Bob wants to hire only two workers. Bob's price elasticity of demand for workers is calculated as_________ , which means workers are a(n) __________ resource for Bob (type either elastic / inelastic / unitary elastic in the second blank and spell correctly). For all numbers, please make sure you round to two decimal places (putting the required digits to the left of the decimal point and two digits to the right of the decimal point and an additional hint is to use the midpoint method).