4. Minimum wage legislation Part 3The following graph shows the labor market in the fast-food industry in the fictional town of Supersize City.Use the graph input tool to help you answer the following questions. 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. Graph Input ToolMarket for Labor in the Fast Food Industry2018I Wage(Dollars per hour)616SupplyLabor Demanded(Thousands ofworkers)Labor Supplied(Thousands ofworkers)560141210Demand80 160 240 320 400 480 560 640 720 800LABOR (Thousands of workers)In this market, the equilibrium hourly wage is$10, and the equilibrium quantity of labor is400 thousand workers.Suppose a senator introduces a bill to legislate a minimum hourly wage of $6. This type of price control is called a price floorFor each of the wages listed in the following table, determine the quantity of labor demanded, the quantity of labor supplied, and the direction ofpressure exerted on wages in the absence of any price controls.WageLabor DemandedLabor Supplied(Dollars per hour) (Thousands of workers) (Thousands of workers)Pressure on Wages12Downward8UpwardTrue or False: A minimum wage below $10 per hour is not a binding minimum wage in this market.O TrueO FalseWAGE (Dollars per hour)

Equilibrium occurs at the intersection point of the demand and supply curve. In this market, the…

The following graph shows the labor market in the fast-food industry in the fictional town of Supersize City. Use the graph input tool to help you answer the following questions. 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.

The following graph shows the labor market in the fast-food industry in the fictional town of Supersize City. Use the graph input tool to help you answer the following questions. 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.

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter12: Labor Markets And Labor Unions

Section: Chapter Questions

Problem 1.1P

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4. Minimum wage legislation Part 3

The following graph shows the labor market in the fast-food industry in the fictional town of Supersize City.

Use the graph input tool to help you answer the following questions. 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.

Graph Input Tool
Market for Labor in the Fast Food Industry
20
18
I Wage
(Dollars per hour)
6
16
Supply
Labor Demanded
(Thousands of
workers)
Labor Supplied
(Thousands of
workers)
560
14
12
10
Demand
80 160 240 320 400 480 560 640 720 800
LABOR (Thousands of workers)
In this market, the equilibrium hourly wage is
$10, and the equilibrium quantity of labor is
400 thousand workers.
Suppose a senator introduces a bill to legislate a minimum hourly wage of $6. This type of price control is called a price floor
For each of the wages listed in the following table, determine the quantity of labor demanded, the quantity of labor supplied, and the direction of
pressure exerted on wages in the absence of any price controls.
Wage
Labor Demanded
Labor Supplied
(Dollars per hour) (Thousands of workers) (Thousands of workers)
Pressure on Wages
12
Downward
8
Upward
True or False: A minimum wage below $10 per hour is not a binding minimum wage in this market.
O True
O False
WAGE (Dollars per hour)

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