Microeconomic Theory
12th Edition
ISBN: 9781337517942
Author: NICHOLSON
Publisher: Cengage
expand_more
expand_more
format_list_bulleted
Question
Chapter 16, Problem 16.4P
a)
To determine
To find:
Equilibrium level of w and l
b)
To determine
To know:
Amount of subsidy, new equilibrium level and subsidy to be paid.
c)
To determine
To know:
Demand for labor and
d)
To determine
To plot:
Graphical representation of the results.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
The demand curve for gardeners is G(D) = 19 – W, where G = the numberof gardeners, and W = the hourly wage. The supply curve is G(S) = 4 + 2 W .
a. Suppose the town government imposes a $2 per hour tax on all gardeners. Indicate the effect of the tax on the market for gardeners.What is the effect on the equilibrium wage and the equilibrium number of gardeners hired? How much does the gardener receive? Howmuch does the customer pay? How much does the government receiveas tax revenue?
Walmart employs the majority of people in small rural town. It's demand for labor is given by QD=100-2P. The supply of labor is given by Qs=3P.
✓ people would be
If the labor market functioned as a competitive market, the wage rate (the price of labor) would be
employed, and the producer surplus would be
Because Walmart faces little competition for workers, it decides to offer the wage that maximizes consumer surplus (the monopsonist price). This
wage is
✓being employed. The producer surplus is now
✓. Note: don't worry if the number of
✓, which results in
workers is not an integer.
Suppose the Thai market of unskilled labor is in equilibrium where the equilibrium wage and equilibrium quantity of labor employed are W and L, respectively. Then, the government decides to impose a minimum wage at a wage of W* which is lower than W.
Carefully explain whether the following statement is true or false
"Therefore, with this imposed minimum wage, all unskilled labor are financially worse off"
Knowledge Booster
Similar questions
- Hello, can you assist me with all parts of this question and show how you did the work, please? Thank youarrow_forwardThe 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 I Wage (Dollars per hour) 18 Supply 16 Labor Demanded (Thousands of workers) Labor Supplied (Thousands of workers) 174 126 14 12 10 8 Demand 4 2 30 60 90 120 150 180 210 240 270 300 LABOR (Thousands of workers) WAGE (Dollars per hour)arrow_forwardThe graph on the right shows the demand for and supply of labor in a market with an equilibrium wage rate of $8 per hour. Show the impact on the graph if a minimum wage of $10 per hour is enacted. 1.) Using the point drawing tool, plot the point that illustrates the quantity of labor demanded when the minimum wage is set at $10 per hour. Label your point 'A.' 2.) Using the point drawing tool, plot a point that illustrates the quantity of labor supplied when the minimum wage is set at $10 per hour. Label your point 'B.' Carefully follow the instructions above and only draw the required objects. Wage 14- 12- 10- 8- co có 4. 2- 9 0 B Labor supply Labor demand 6 7 Quantity of labor (millions) 8 9 10arrow_forward
- In this market, the equilibrium hourly wage is ___, and the equilibrium quantity of labor is thousand workers. Suppose a senator introduces a bill to legislate a minimum hourly wage of $6. This type of price control is called a . 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 Pressure on Wages (Dollars per hour) (Thousands of workers) (Thousands of workers) 8 12 True or False: A minimum wage above $10 per hour is a binding minimum wage in this market. True Falsearrow_forwardhow would you approach the questions?arrow_forwardDon't use Ai and chatgpt. Answer in step by step with explanation.arrow_forward
- Solve it now I upvotearrow_forwardThe following graph gives the labor market for the fast-food industry of the imaginary city of Combopolis. 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. WAGE (Dollars per hour) 20 10 16 14 10 4 2 0 0 Supply Demand 50 100 150 200 250 300 350 400 450 500 LABOR (Hundreds of workers) Graph Input Tool Market for Labor in the Fast Food Industry Wage (Dollars per hour) Labor Demanded (Hundreds of workers) 6 500 Labor Supplied (Hundreds of workers) 210arrow_forwardThe following graph shows the labor market in the fast-food industry in the fictional town of Supersize City.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. please helparrow_forward
- The minimum wage is typically set above the market-clearing wage in the market for labor. Using a graph with an upward-sloping supply of labor, a downward-sloping demand for labor, with the quantity of labor measured on the horizontal axis and the wage rate on the vertical axis, show the effect on the labor market of a minimum wage set above the equilibrium wage rate. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forwardWho should pay the tax? The following graph gives the labor market for laboratory aides in the imaginary country of Paideia. The equilibrium hourly wage is $10 , and the equilibrium number of laboratory aides is 150 . Suppose the federal government of Paideia has decided to institute an hourly payroll tax of $4 on laboratory aides and wants to determine whether the tax should be levied on the workers, the employers, or both (in such a way that hay the tax is collected from each party). Use the graph input tool to evaluate these thret proposal5; Entering a number into the Tax Levied on Employers feld (inibialy set at adro dallars per hour) shilts the demand curve down by the amount you enter, and entering a number into the Tax Leviod on workers fieid (initially set at acro dollas per bour) shifts the supply curve up by the amount your enter. To determine the before-tax wage for each tar proposal, adjust the amcunt in the wage field unbil the quantity of labor supplied…arrow_forwardThe demand for labor is L= 4000 - 300w, where L is the number of workers demanded and w is the hourly wage rate. The supply of labor is L = 200w. The equilibrium wage rate in this market is $ 8. and the equilibrium quantity of labor is 1600 workers. (Enter your responses as integers.) A minimum wage law is passed that sets the minimum wage at $9 per hour. As a result, 1300 workers are demanded and 1800 workers are supplied, so unemployment is 500 workers. (Enter your responses as integers.) Do all workers benefit from the minimum wage law? No. because not everyone can find work at the higher wage. Which group of workers will have the least dificulty finding work at the minimum wage? A. Young and inexperienced warkers. B. Low skilled workers. C. Highly educated workers. D. All of the above. The deadweight loss from the minimum wage law is (Enter your response as an integer.)arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Exploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, Inc
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc