Microeconomics
11th Edition
ISBN: 9781260507140
Author: David C. Colander
Publisher: McGraw Hill Education
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Question
Chapter 17, Problem 16QE
(a)
To determine
Explain the given argument.
(b)
To determine
Determine the impact, when the suppliers operate in an imperfect market structure.
(c)
To determine
Determine the lower limit of the price that Walmart could name.
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Students have asked these similar questions
Consider the graph at right for a monopsonistic labor market.
The competitive wage is $750.00 per hour, and the competitive labor use is 62.50 workers.
In a monopsonistic labor market, the amount of labor used will be 41.7 workers and the wage will
be $ per hour (round your answer to the nearest penny).
(Round all of the following answers to the nearest dollar.)
In a monopsonistic labor market, consumer surplus will be $ ; the monopsonistic labor market
producer surplus will be area $, and the monopsonistic labor market producer deadweight loss
will be $
w, wage per hour
1400.00-
1200.00-
1000.00-
800.00-
600.00-
400.00-
200.00-
Monopsonistic Labor Market
833.33
0.00+
0.0
41.7
40.0
L, Workers per hour
80.0
ME
S
D
Q
Stone Inc. owns a clothing factory and hires workers in a competitive labor market to stitch cut denim fabric into jeans. The fabric required to make each pair of jeans costs $5. The company’s weekly output of finished jeans varies with the number of workers hired, as shown in the following table:
Number of workers
Jeans (pairs per week)
0
0
1
25
2
45
3
60
4
72
5
80
6
85
a. If the jeans sell for $35 a pair and the competitive market wage is $250 per week, how many workers should Stone hire?
_____ workers
How many pairs of jeans will the company produce each week?
____ pairs of jeans
b. Suppose the Clothing Workers Union now sets a weekly minimum acceptable wage of $230 per week. All the workers Stone hires belong to the union. How does the minimum wage affect Stone’s decision about how many workers to hire?
Stone’s decision (Will/will not) be affected by the minimum wage.
c. If the minimum wage set by the union had been $400 per week, how would the minimum…
The table shows levels of employment (Labor), the marginal product of each of those levels, and a monopoly's marginal revenue. What is the monopoly's marginal revenue product at each level of employment? If the monopoly operates in a perfectly competitive labor market where the going market wage is $20, what is the firm's profit maximizing level of employment?
Chapter 17 Solutions
Microeconomics
Ch. 17.1 - Prob. 1QCh. 17.1 - Prob. 2QCh. 17.1 - Prob. 3QCh. 17.1 - Prob. 4QCh. 17.1 - Prob. 5QCh. 17.1 - Prob. 6QCh. 17.1 - Prob. 7QCh. 17.1 - Prob. 8QCh. 17.1 - Prob. 9QCh. 17.1 - Prob. 10Q
Ch. 17.A - Prob. 1QECh. 17.A - Prob. 2QECh. 17.A - Prob. 3QECh. 17.A - Prob. 4QECh. 17.A - Prob. 5QECh. 17.A - Prob. 6QECh. 17.A - Prob. 7QECh. 17.A - Prob. 8QECh. 17.W - Prob. 1QECh. 17.W - Prob. 2QECh. 17.W - Prob. 3QECh. 17.W - Prob. 4QECh. 17.W - Prob. 5QECh. 17.W - Prob. 6QECh. 17.W - Prob. 7QECh. 17.W - Prob. 8QECh. 17.W - Prob. 9QECh. 17.W - Prob. 10QECh. 17.W - Prob. 1QAPCh. 17.W - Prob. 2QAPCh. 17.W - Prob. 3QAPCh. 17.W - Prob. 4QAPCh. 17.W - Prob. 5QAPCh. 17.W - Prob. 1IPCh. 17.W - Prob. 2IPCh. 17.W - Prob. 3IPCh. 17.W - Prob. 4IPCh. 17.W1 - Prob. 1QCh. 17.W1 - Prob. 2QCh. 17.W1 - Prob. 3QCh. 17.W1 - Prob. 4QCh. 17.W1 - Prob. 5QCh. 17.W1 - Prob. 6QCh. 17.W1 - Prob. 7QCh. 17.W1 - Prob. 8QCh. 17.W1 - Prob. 9QCh. 17.W1 - Prob. 10QCh. 17 - Prob. 1QECh. 17 - Prob. 2QECh. 17 - Prob. 3QECh. 17 - Prob. 4QECh. 17 - Prob. 5QECh. 17 - Prob. 6QECh. 17 - Prob. 7QECh. 17 - Prob. 8QECh. 17 - Prob. 9QECh. 17 - Prob. 10QECh. 17 - Prob. 11QECh. 17 - Prob. 12QECh. 17 - Prob. 13QECh. 17 - Prob. 14QECh. 17 - Prob. 15QECh. 17 - Prob. 16QECh. 17 - Prob. 17QECh. 17 - Prob. 18QECh. 17 - Prob. 19QECh. 17 - Prob. 20QECh. 17 - Prob. 21QECh. 17 - Prob. 22QECh. 17 - Prob. 23QECh. 17 - Prob. 24QECh. 17 - Prob. 25QECh. 17 - Prob. 26QECh. 17 - Prob. 1QAPCh. 17 - Prob. 2QAPCh. 17 - Prob. 3QAPCh. 17 - Prob. 4QAPCh. 17 - Prob. 5QAPCh. 17 - Prob. 6QAPCh. 17 - Prob. 1IPCh. 17 - Prob. 2IPCh. 17 - Prob. 3IPCh. 17 - Prob. 4IPCh. 17 - Prob. 5IPCh. 17 - Prob. 6IPCh. 17 - Prob. 7IPCh. 17 - Prob. 8IPCh. 17 - Prob. 9IPCh. 17 - Prob. 10IPCh. 17 - Prob. 11IP
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Similar questions
- Table 15.6 shows the quantity demanded and supplied in the labor market for driving city buses in the town of Unionville, where all the bus drivers belong to a union. a. What would the equilibrium wage and quantity be in this market if no union existed? b. Assume that the union has enough negotiating power to raise the wage to $4 per hour higher than it would otherwise be. Is there now excess demand or excess supply of labor?arrow_forwardD The following graph gives the labor market for laboratory aides in the imaginary country of Sophos. The equilibrium hourly wage is $10, and the equilibrium number of laboratory aides is 250. Suppose the federal government of Sophos 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 half the tax is collected from each party). Use the graph input tool to evaluate these three proposals. Entering a number into the Tax Levied on Employers field (initially set at zero dollars per hour) shifts the demand curve down by the amount you enter, and entering a number into the Tax Levied on Workers field (initially set at zero dollars per hour) shifts the supply curve up by the amount you enter. To determine the before-tax wage for each tax proposal, adjust the amount in the Wage field until the quantity of labor supplied equals the quantity of labor demanded.…arrow_forwardThe following graph depicts a hypothetical labor market under monopsony. WAGE RATE (dollars per hour) 37 34 Marginal Factor Cost 31 28 Labor Supply 25 22 19 16 13 0 2 3 Labor Demand 5 QUANTITY OF LABOR (Workers per hour) Suppose that a minimum wage of $19 per hour is instated in this labor market. At a wage rate of $19 per hours, the quantity of labor supplied is ? the quantity of labor demanded.arrow_forward
- What would be the effect of a decrease in the price of lumber on demand for labor in the lumber producing industry? The demand for labor will remain unchanged The demand for labor will increase The demand for labor will decreasearrow_forwarda. What happens to wages and employment if the government imposes a payroll tax on a monopsonist? Compare the response in the monopsonistic market to the response that would have been observed in a competitive labor market.b. Suppose a firm is a perfectly discriminating monopsonist. The government imposes a minimum wage on this market. What happens to wages and employment?arrow_forwardhe table below shows the quantity demanded and supplied in the labor market for economics professors at the l'MaStateUniversity, where all the professors belong to a union. If the union has enough negotiating power to raise the annual salary by $20,000 more than a non- unionized university would be willing to pay, then there will be excess of labor of economics professors.arrow_forward
- What would happen if the labour market is dominated by a monopsonist, and the government sets a minimum wage that is above the competitive wage? please answer with graphsarrow_forwardExplain the impact that supply and demand have on pricing. Include how supply and demand is influenced by the labor market and the role of the labor union. Also, compare and contrast the impact different types of market structures have on supply and demand.arrow_forwardEconomics Suppose that Congress passes a law requiring employers to provide employees some benefit (such as healthcare) that raises the cost of an employee by $3 per hour. Assume that firms were not providing such benefits prior to the legislation. On the following graph, use the green line (triangle symbel) to show the effect this employer mandate has on the demand for labor. Demand Supply 20 18 New Demand 10 14 12 New Supply 10 Equilibrium Before Law Equilibrium After Law 0 1 2 5 10 Quantity of Labor (Thousands) Suppose employees place a value on this benefit exactly equal to its cost. 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 eauilibrium 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…arrow_forward
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