In some labor markets, the supply of labor is as follows (where W represents wages and L represents the number of employees): W = 114 +0.23L However, the demand for labor is: W = 988 -0.23L a) At what salary and number of employees is equilibrium in this labor market? b) If, however, the wage is different from the equilibrium wage of 7%, how much unemployment or excess demand in the number of people will be considered in the market? A positive percentage means an increase from the equilibrium wage, while a negative percentage means a decrease from the equilibrium wage.

In some labor markets, the supply of labor is as follows (where W represents wages and L represents the number of employees): W = 114 +0.23L However, the demand for labor is: W = 988 -0.23L a) At what salary and number of employees is equilibrium in this labor market? b) If, however, the wage is different from the equilibrium wage of 7%, how much unemployment or excess demand in the number of people will be considered in the market? A positive percentage means an increase from the equilibrium wage, while a negative percentage means a decrease from the equilibrium wage.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter16: The Markets For Labor, Capital, And Land

Section: Chapter Questions

Problem 5P

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