Income tax affect the supply of labour and real wage rate of labour. Figure Qs shows the effects of income tax on the number of labour supply and the real wage rate of labour. LD, is labour demand curve, LS, is labour supply curve before tax, and LS¡ is labour supply curve after tax. Real wage rate (RM per hour) 50 - LS1 40 LSo 30 - 20 LD, 10- 200 210 220 Labour (billion of hours per year) Figure Q5 : Income tax in the labour market Determine the following based on the information given in figure Q5: (1) Equilibrium hours of labour supply and real wage rate per hour before tax. (ii) Equilibrium hours of labour supply and real wage rate per hour after tax. (iii) Real wage rate per hour paid by firm and real wage rate per hour received by workers.

Income tax affect the supply of labour and real wage rate of labour. Figure Qs shows the effects of income tax on the number of labour supply and the real wage rate of labour. LD, is labour demand curve, LS, is labour supply curve before tax, and LS¡ is labour supply curve after tax. Real wage rate (RM per hour) 50 - LS1 40 LSo 30 - 20 LD, 10- 200 210 220 Labour (billion of hours per year) Figure Q5 : Income tax in the labour market Determine the following based on the information given in figure Q5: (1) Equilibrium hours of labour supply and real wage rate per hour before tax. (ii) Equilibrium hours of labour supply and real wage rate per hour after tax. (iii) Real wage rate per hour paid by firm and real wage rate per hour received by workers.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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16. Suppose that the government imposes a minimum wage of $7. Then, the size of labor force will be people, the number of people employed will be. , and the number of people unemployed will be. a. labor force = 50, employment = 30, unemployment = 20 b. labor force = 50, employment = 50, unemployment = 0 c. labor force = 70, employment = 30, unemployment = 40 d. labor force 70, employment = 50, unemployment = 20
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120 110 &&&RSRSR22. 100 90 80 20 10,000 20,000 000'DE 40,000 50,000 60,000 70,000 80,000 Consider the information in the file named Hypothetical Labor Market Graph. The graph shows the aggregate demand for labor in a small country with a civilian population of 100,000 persons. The labor force participation rate in this country is only 30% and it does not depend on the level of real wage. Wages and prices are fully flexible downwards and upwards. Start from the base case. Suppose that due to changes in social norms, the participation rate of women in the labor force increases. As a result, the overall labor force participation rate increases to 50.00% Ceteris paribus, this event causes the equilibrium real wage to change to units.
Suppose that the United States cracks down on illegal immigrants and returns millions of workers to their home countries. Draw a labor supply curve and a labor demand curve for the United States. Label the curves LS, and LDO Draw a point to show the equilibrium quantity of labor and the equilibrium real wage rate. Label it 1. Now suppose the United States returns millions of illegal immigrant workers to their home countries. Draw and label a curve that shows the effect of this return of workers. Draw a point to show the new equilibrium quantity of labor and the equilibrium real wage rate. Label it 2.
Labour Supply and Taxes 1. Let the (pre-tax) price level P equal 1. Let W denote the nominal wage rate and L denote the number of hours worked. Suppose the income tax rate is th. (a) Suppose that L equals 100. Calculate after-tax income (after-income tax income). (b) Suppose the sales tax rate (the tax rate on consumption) is denoted to . Suppose that, with the pre-sales tax P equal to 1, the price of goods equals (1+ c ). Calculate after-tax real (labour) income (this after-tax variable depends on both tax rates). Explain, in words, what this after-tax real income variable measures.
The United States has established a progressive income tax system, where a worker’s tax rate onearnings increases as she earns more money. There are 168 hours in a given week. Assume thatfor the first 56 hours worked, the tax rate is t1, which means that the net real wage is w*(1-t1).After working the 56th hour, the worker jumps to a higher tax rate t2. After the 112th hourworked, the individual jumps to an even higher tax rate, t3.(a) During most election years, some politicians argue that a having a flat tax system isbetter. Assume that there is a proposal to institute a flat tax, where all workers pay a taxrate equal to t4, which is greater than t3. On the same set of axes, graph the budgetconstraints associated with the progressive tax system and the flat tax system. Make sureto label all of the slopes.(b) Would moving to this proposed flat tax system likely encourage more or fewer hoursworked for relatively high-wage workers? Make sure to explain your answer (a writtenexplanation…
Please no written by hand In the United States, the number of professional workers with college degrees is expected to Blank______ in the coming years. steadily decline increase significantly remain stable
2. Discuss the labor-force participation trends for men and women since 1950
2. What distinguishes an MNE from a non-MNE?
Real Wage Number of Workers Demanded Labor Force Participation Rate 60 120,000,000 30% 70 110,000,000 35% 80 100,000,000 40% 90 90,000,000 45% 100 80,000,000 50% 110 70,000,000 55% 120 60,000,000 60% 130 50,000,000 65% 140 40,000,000 70% 150 30,000,000 75% 160 20,000,000 80% 170 10,000,000 85% Ignore everything that happened in the previous questions. We know that supply of labor can increase either because of an increase in labor force participation rate or an increase in civilian population. We saw the effect of the former above. This question is about the latter. The table above shows some pieces of information about the labor market condition in a country. It shows the number of workers demanded in the country at different levels of real wage. It also shows the labor force participation rates at those real wage levels. For example, if the real wage is 60, only 30% of the civilian population will participate in the labor force. If the real wage is…