The table below shows the quantity demanded and supplied in the labor market for nurses in the town of Neverland, where all nurses belong to a union. Quantity Quantity Wages per Hour Demanded of Workers Supplied of Workers $20 12,000 6,000 $25 10,000 7,000 $30 8,000 8,000 $35 6,000 9,000 $40 4,000 10,000 $45 2,000 11,000 Based on the table above, answer the following: a) What would the equilibrium wage and equilibrium quantity of workers be in this market if no union existed? JUSTIFY your answer! b) Assume that the union has enough negotiating power to raise the wage to $10 per hour higher than it would otherwise be. Is there now excess demand or excess supply of workers? JUSTIFY your answer!
The table below shows the quantity demanded and supplied in the labor market for nurses in the town of Neverland, where all nurses belong to a union. Quantity Quantity Wages per Hour Demanded of Workers Supplied of Workers $20 12,000 6,000 $25 10,000 7,000 $30 8,000 8,000 $35 6,000 9,000 $40 4,000 10,000 $45 2,000 11,000 Based on the table above, answer the following: a) What would the equilibrium wage and equilibrium quantity of workers be in this market if no union existed? JUSTIFY your answer! b) Assume that the union has enough negotiating power to raise the wage to $10 per hour higher than it would otherwise be. Is there now excess demand or excess supply of workers? JUSTIFY your answer!
Microeconomics: Principles & Policy
14th Edition
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:William J. Baumol, Alan S. Blinder, John L. Solow
Chapter19: Labor And Entrepreneurship: The Human Inputs
Section: Chapter Questions
Problem 5DQ
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Question
![The table below shows the quantity demanded and supplied in the labor market for nurses in the town of Neverland, where all nurses belong
to a union.
Quantity
Quantity
Wages per Hour
Demanded of Workers
Supplied of Workers
$20
12,000
6,000
$25
10,000
7,000
$30
8,000
8,000
$35
6,000
9,000
$40
4,000
10,000
$45
2,000
11,000
Based on the table above, answer the following:
a) What would the equilibrium wage and equilibrium quantity of workers be in this market if no union existed? JUSTIFY your answer!
b) Assume that the union has enough negotiating power to raise the wage to $10 per hour higher than it would otherwise be. Is there now
excess demand or excess supply of workers? JUSTIFY your answer!](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Faf75cc1a-323a-458a-a5ff-a394541d71e0%2Ff387e108-d672-49ff-b2bf-831bb848f8a4%2Fpiug4_processed.png&w=3840&q=75)
Transcribed Image Text:The table below shows the quantity demanded and supplied in the labor market for nurses in the town of Neverland, where all nurses belong
to a union.
Quantity
Quantity
Wages per Hour
Demanded of Workers
Supplied of Workers
$20
12,000
6,000
$25
10,000
7,000
$30
8,000
8,000
$35
6,000
9,000
$40
4,000
10,000
$45
2,000
11,000
Based on the table above, answer the following:
a) What would the equilibrium wage and equilibrium quantity of workers be in this market if no union existed? JUSTIFY your answer!
b) Assume that the union has enough negotiating power to raise the wage to $10 per hour higher than it would otherwise be. Is there now
excess demand or excess supply of workers? JUSTIFY your answer!
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