Bundle: Principles of Economics, Loose-leaf Version, 8th + LMS Integrated MindTap Economics, 2 terms (12 months) Printed Access Card
8th Edition
ISBN: 9781337607735
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 28, Problem 4CQQ
To determine
Increase in wage rate and its effect in the labor demand and supply curve.
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The demand for a factor of production (productive resource) is derived from the demand for the good
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For each of the following determine the impact on the demand or the supply of labor and the effect on the equilibrium wage and quantity of labor employed.
a. An increase in the price of capital.
b. A union is formed which uses collective bargaining to obtain higher wages for its members.
c. The marginal productivity of workers rises.
d. People desire leisure more than ever before (e.g. it is Christmas Day).
e. The wages offered in other labor markets requiring similar skills are now offering substantially higher wages.
f. The fringe (non-monetary) benefits offered in this market have increased substantially.
g. The government has just adopted an "open-door' immigration policy?
The information below is for a competitive labor market.
A. Calculate the value of the marginal product of labor at X.
B. Find the equilibrium wage.
C. Find the equilibrium quantity of labor employed.
Chapter 28 Solutions
Bundle: Principles of Economics, Loose-leaf Version, 8th + LMS Integrated MindTap Economics, 2 terms (12 months) Printed Access Card
Ch. 28.1 - Prob. 1QQCh. 28.2 - Prob. 2QQCh. 28.3 - Prob. 3QQCh. 28.4 - Prob. 4QQCh. 28.5 - Prob. 5QQCh. 28 - Prob. 1CQQCh. 28 - Using the numbers in the preceding question, what...Ch. 28 - Prob. 3CQQCh. 28 - Prob. 4CQQCh. 28 - Prob. 5CQQ
Ch. 28 - Prob. 6CQQCh. 28 - Prob. 1QRCh. 28 - Prob. 2QRCh. 28 - Prob. 3QRCh. 28 - Prob. 4QRCh. 28 - Prob. 5QRCh. 28 - Prob. 6QRCh. 28 - Prob. 7QRCh. 28 - Prob. 1PACh. 28 - Prob. 2PACh. 28 - Prob. 4PACh. 28 - Prob. 5PACh. 28 - Prob. 6PACh. 28 - Prob. 7PACh. 28 - Prob. 8PACh. 28 - Prob. 9PACh. 28 - Prob. 10PA
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- Which of the following can reduce the marginal revenue product of labor? Select one: a. A reduction in the demand for firms– products. b. A reduction in workers– supply of labor to firms. c. A decrease in firms– demand for inputs that substitute for labor. d. An increase in the extra output firms gain from adding another unit of labor.arrow_forwardLabor demand becomes more elastic as the demand for the firm’s output a. becomes more elastic b. becomes less elastic c. increases d. decreases e. is at market equilibriumarrow_forwardIn the model of a competitive labor market, an increase in the wage, ceteris paribus, causes A. an increase in the quantity demanded of labor B. the MRP curve to shift to the left c. a decrease in the quantity demanded of labor D. the MRP curve shifts to the rightarrow_forward
- Suppose that the market for labor is initially in equilibrium. An increase in the price of output will cause the equilibrium wage a. and the equilibrium quantity of labor to fall. b. and the equilibrium quantity of labor to rise. c. to rise and the equilibrium quantity of labor to fall. d. to fall and the equilibrium quantity of labor to rise.arrow_forwardHow does an increase in the minimum wage affect employment in the short run according to conventional economic theory? A. Increases employment B. Decreases employment C. Has no effect on employment D. Depends on other factorsarrow_forwardam. 10.arrow_forward
- Please don't use any AI tool.arrow_forwardIn a competitive labor market for bakers, the equilibrium wage rate .. A. rises if the market price of bakery items falls OB. rises if new technology makes it easier for anyone to be a baker OC. falls if the supply of bakers decreases D. rises if bakers become more productivearrow_forwardWhen is an employer forced to keep the labor cost low? A. When the product demand is inelastic. B. When the employer is in a competitive product market. C. When the rate of unemployment is low. D. When certain skills are essential for production.arrow_forward
- Consider the following labor supply and demand curves. For each of the following situations, show and explain what would happen to the labor market. a) The firm finds a new market for their output. Wage WE S Quantityarrow_forwardNot use ai pleasearrow_forwardSuppose Kara maximizes her profits by hiring workers to produce hand-made soaps. Her soaps sell for $1 each. How should Kara decide on how many workers she should hire? a.Hire workers up to the point when the price of her soaps starts to fall from $1 b.Hire workers up to the point when the total product of all her workers is at its maximum c.Hire up to the point when the wage rate equals to the value of the marginal product of the last worker hired d.Hire up to the point when the marginal product of the last worker hired is equal to zeroarrow_forward
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