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On the preceding graph, use the purple line (diamond symbol) to show the effect this employer mandate has on the supply of labor. Suppose the wage is free to balance supply and demand. Use the black point (plus symbol) to indicate the equilibrium wage and level of employment before this law, and use the grey point (star symbol) to indicate the equilibrium wage and level of employment after this law is implemented. True or False: Employers and employees are made better off by this law. True O False Suppose that, before the mandate, the wage in this market was $3 above the minimum wage.

On the preceding graph, use the purple line (diamond symbol) to show the effect this employer mandate has on the supply of labor. Suppose the wage is free to balance supply and demand. Use the black point (plus symbol) to indicate the equilibrium wage and level of employment before this law, and use the grey point (star symbol) to indicate the equilibrium wage and level of employment after this law is implemented. True or False: Employers and employees are made better off by this law. True O False Suppose that, before the mandate, the wage in this market was $3 above the minimum wage.

Macroeconomics: Private and Public Choice (MindTap Course List)
Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter4: Demand And Demand: Applications And Extensions
Section: Chapter Questions
Problem 12CQ
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On the preceding graph, use the purple line (diamond symbol) to show the effect this employer mandate has on the supply of labor. Suppose the wage is free to balance supply and demand. Use the black point (plus symbol) to indicate the equilibrium wage and level of employment before this law, and use the grey point (star symbol) to indicate the equilibrium wage and level of employment after this law implemented. True or False: Employers and employees are made better off by this law. True O False Suppose that, before the mandate, the wage in this market was $3 above the minimum wage. In this case, the wage rate with the employer mandate will be an increase in the level of unemployment. Now suppose that workers do not value the mandated benefit at all. Which of the following statements are true under this circumstance? Check all that apply. Employers are worse off than before the mandated benefit. The supply curve of labor doesn't shift at all. $7 per hour, which will lead to a decrease The wage rate will decline by exactly $4. Employees are neither better nor worse off than before the mandated benefit. The equilibrium quantity of labor will rise. in the level of employment and
Transcribed Image Text:On the preceding graph, use the purple line (diamond symbol) to show the effect this employer mandate has on the supply of labor. Suppose the wage is free to balance supply and demand. Use the black point (plus symbol) to indicate the equilibrium wage and level of employment before this law, and use the grey point (star symbol) to indicate the equilibrium wage and level of employment after this law implemented. True or False: Employers and employees are made better off by this law. True O False Suppose that, before the mandate, the wage in this market was $3 above the minimum wage. In this case, the wage rate with the employer mandate will be an increase in the level of unemployment. Now suppose that workers do not value the mandated benefit at all. Which of the following statements are true under this circumstance? Check all that apply. Employers are worse off than before the mandated benefit. The supply curve of labor doesn't shift at all. $7 per hour, which will lead to a decrease The wage rate will decline by exactly $4. Employees are neither better nor worse off than before the mandated benefit. The equilibrium quantity of labor will rise. in the level of employment and
Suppose that Congress passes a law requiring employers to provide employees some benefit (such as healthcare) that raises the cost of an employee by $4 per hour. Assume that firms were not providing such benefits prior to the legislation. On the following graph, use the green line (triangle symbol) to show the effect this employer mandate has on the demand for labor. Wage (Dollars per hour) 20 18 16 14 12 10 8 6 4 2 0 Demand 4 5 6 7 Quantity of Labor (Thousands) 0 1 2 3 8 Supply 9 10 New Demand New Supply ++ Equilibrium Before Law Equilibrium After Law (?)
Transcribed Image Text:Suppose that Congress passes a law requiring employers to provide employees some benefit (such as healthcare) that raises the cost of an employee by $4 per hour. Assume that firms were not providing such benefits prior to the legislation. On the following graph, use the green line (triangle symbol) to show the effect this employer mandate has on the demand for labor. Wage (Dollars per hour) 20 18 16 14 12 10 8 6 4 2 0 Demand 4 5 6 7 Quantity of Labor (Thousands) 0 1 2 3 8 Supply 9 10 New Demand New Supply ++ Equilibrium Before Law Equilibrium After Law (?)
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