Microeconomics, Student Value Edition (6th Edition)
6th Edition
ISBN: 9780134125756
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 4.A, Problem 5PA
To determine
The equilibrium wage and quantity of labor.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Suppose that you have been hired to analyze the impact on employment from the imposition of a minimum wage in the labor market. Further suppose that you estimate the supply and demand functions for labor, where L stands for the quantity
of labor (measured
thousands of workers) and W stands for the wage rate (measured in dollars per hour):
D= 100 - 6W
LS = 4W.
Demand:
Supply:
First, calculate the free-market equilibrium wage and quantity of labor.
The competitive market equilibrium wage is $ per hour. (Enter your response as an integer.)
Can you let me know if i got these correct. thanks
You are GIVEN the liberty to construct a hypothetical geometric illustration of Labor Market where you measure the
following variables on the specific axis:
A On the vertical axis is the WAGE=the Price of Labor (in Pesos per day)
B. On the horizontal axis is the QUANTITY of Labor demand and supply (in man-hours per day)
REQUIREMENTS:
1. Show the EQUILIBRIUM point by bringing together the DEMAND and SUPPLY of LABOR. Label your graph accordingly.
2. Consider an INCREASE in the wage (as demanded by the labor groups) to a higher level than the equilibrium price for labor.
SHOW geometrically what will happen in the labor market. What problem(s) is/are likely to arise in the labor market?
3. In the face of the problem(s) that are now obtaining in the labor market, what would you recommend as a set of policies or
programs to address such problems. Illustrate your recommendations geometrically (i.e., graphically).
4. The analysis of causation above is LABOR-CENTERED. As a continuing student in…
Chapter 4 Solutions
Microeconomics, Student Value Edition (6th Edition)
Ch. 4.A - Prob. 1RQCh. 4.A - Prob. 2RQCh. 4.A - Prob. 3RQCh. 4.A - Why would economists use the term deadweight loss...Ch. 4.A - Prob. 5PACh. 4.A - Prob. 6PACh. 4.A - Prob. 7PACh. 4.A - Prob. 8PACh. 4.A - Prob. 9PACh. 4 - Prob. 1TC
Ch. 4 - Prob. 2TCCh. 4 - Prob. 4.1.1RQCh. 4 - Prob. 4.1.2RQCh. 4 - Prob. 4.1.3RQCh. 4 - Prob. 4.1.4RQCh. 4 - Prob. 4.1.5PACh. 4 - Prob. 4.1.6PACh. 4 - Prob. 4.1.7PACh. 4 - Prob. 4.1.8PACh. 4 - Prob. 4.1.9PACh. 4 - Prob. 4.1.10PACh. 4 - Prob. 4.1.11PACh. 4 - Prob. 4.1.12PACh. 4 - Prob. 4.1.13PACh. 4 - Prob. 4.1.14PACh. 4 - Prob. 4.2.1RQCh. 4 - Prob. 4.2.2RQCh. 4 - Prob. 4.2.3PACh. 4 - Prob. 4.2.4PACh. 4 - Prob. 4.2.5PACh. 4 - Prob. 4.2.6PACh. 4 - Prob. 4.2.7PACh. 4 - Prob. 4.2.8PACh. 4 - Prob. 4.2.9PACh. 4 - Prob. 4.2.10PACh. 4 - Prob. 4.3.1RQCh. 4 - Prob. 4.3.2RQCh. 4 - Prob. 4.3.3RQCh. 4 - Prob. 4.3.4RQCh. 4 - Prob. 4.3.5PACh. 4 - Prob. 4.3.6PACh. 4 - Prob. 4.3.7PACh. 4 - Prob. 4.3.8PACh. 4 - Prob. 4.3.9PACh. 4 - Prob. 4.3.10PACh. 4 - Prob. 4.3.11PACh. 4 - Prob. 4.3.12PACh. 4 - Prob. 4.3.13PACh. 4 - Prob. 4.3.14PACh. 4 - Prob. 4.3.15PACh. 4 - Prob. 4.3.16PACh. 4 - Prob. 4.3.17PACh. 4 - Prob. 4.3.18PACh. 4 - Prob. 4.3.19PACh. 4 - Prob. 4.4.1RQCh. 4 - Prob. 4.4.2RQCh. 4 - Prob. 4.4.3RQCh. 4 - As explained in the chapter, economic efficiency...Ch. 4 - Prob. 4.4.5PACh. 4 - Prob. 4.4.6PACh. 4 - Prob. 4.4.7PACh. 4 - Prob. 4.4.8PACh. 4 - Prob. 4.4.9PACh. 4 - Prob. 4.4.10PA
Knowledge Booster
Similar questions
- Suppose that in a competitive output market, firms hire labor from a competitive labor market (so that the profit maximization conditions for hiring labor are as we discussed in class). If the supply of this kind of labor decreases, we would expect which of the following regarding the equilibrium wage, W, and the equilibrium quantity of labor, L, employed? Group of answer choices a) a decrease in W and a decrease L b) a decrease in W and a decrease L c) an increase in W and a decrease L d) a decrease in W and no change in L e) increase in W and an increase in Larrow_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. WAGE (Dollars per hour) 20 18 16 14 12 10 8 6 2 0 0 Supply In this market, the equilibrium hourly wage is Demand 90 180 270 360 450 540 630 720 810 900 LABOR (Thousands of workers) 8 Wage Labor Demanded (Dollars per hour) (Thousands of workers) 12 True Graph Input Tool Market for Labor in the Fast Food Industry Wage (Dollars per hour) False Labor Demanded (Thousands of workers) and the equilibrium quantity of labor is Suppose a senator introduces a bill to legislate a minimum hourly wage of $12 per hour. This type of price control is called a 6 900 Labor Supplied (Thousands of workers) Labor Supplied (Thousands of…arrow_forwardThe following graph shows the labor market for research assistants in the fictional country of Universalia. The equilibrium wage is $10 per hour, and the equilibrium number of research assistants is 100. Suppose the government has decided to institute a $4-per-hour payroll tax on research assistants and is trying to determine whether the tax should be levied on the employer, the workers, or both (such that half the tax is collected from each side). Use the graph input tool to evaluate these three proposals. Entering a number into the Tax Levied on Employers field (initially set at zero dollars per hour) shifts the demand curve down by the amount you enter, and entering a number into the Tax Levied on Workers field (initially set at zero dollars per hour) shifts the supply curve up by the amount you enter. To determine the before-tax wage for each tax proposal, adjust the amount in the Wage field until the quantity of labor supplied equals the quantity of labor demanded. You will…arrow_forward
- i need help with this question, i keep getting it wrong. it is a macroneconics question 10. it requires filling in the boxes.arrow_forwardSuppose you run a business that specializes in producing graphic T-shirts, using labor as an input. Hourly wage ($) 24 22 8 Wage ($) 26 24- 22- Based on the table above, graph the labor supply and labor demand curves and identify the market equilibrium wage and quantity using the graph below. 20- Instructions: Use the line tools provided (Supply and Demand) to plot the labor supply and labor demand lines for wages of $8 and $24 (2 points per line). Use the point tool provided (E) to indicate market equilibrium wage and quantity. 18- 16- 14- 12- 10- A- 2 0 Quantity demanded 0 0 50 100 150 200 250 300 100 350 400 200 300 Quantity supplied 600 550 500 450 400 350 300 400 Hours worked reset 250 200 500 600 Supply Demand Earrow_forwardThe following graph shows the labor market for research assistants in the fictional country of Universalia. The equilibrium wage is $10 per hour, and the equilibrium number of research assistants is 250. Suppose the government has decided to institute a $4-per-hour payroll tax on research assistants and is trying to determine whether the tax should be levied on the employer, the workers, or both (such that half the tax is collected from each side). 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. You will not be…arrow_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_forwardThe following graph shows the labor market for research assistants in the fictional country of Academia. The equilibrium wage is $10 per hour, and the equilibrium number of research assistants is 250. Suppose the government has decided to institute a $4-per-hour payroll tax on research assistants and is trying to determine whether the tax should be levied on the employer, the workers, or both (such that half the tax is collected from each side). 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. You will not be…arrow_forwardThe following graph shows the labor market for research assistants in the fictional country of Academia. The equilibrium wage is $10 per hour, and the equilibrium number of research assistants is 250. Suppose the government has decided to institute a $2-per-hour payroll tax on research assistants and is trying to determine whether the tax should be levied on the employer, the workers, or both (such that half the tax is collected from each side). 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. You will not be…arrow_forward
- 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. WAGE (Dollars per hour) 20 18 16 14 12 2 0 0 Supply Demand 90 180 270 360 450 540 630 720 810 900 LABOR (Thousands of workers) In this market, the equilibrium hourly wage is $ Graph Input Tool Market for Labor in the Fast Food Industry Wage (Dollars per hour) Labor Demanded (Thousands of workers) 6 900 and the equilibrium quantity of labor is Labor Supplied (Thousands of workers) ? 378 thousand workers.arrow_forwardSuppose the demand for burger flippers is LD = 400 – 20W where L=number of burger flippers and W=nominal wage rate ($/hr.) The equilibrium wage is $5 but the government mandates a $6 minimum wage. Draw a graph to show what happens to the labor demand for burger flippers after this minimum wage law is enacted. Suppose there is an uncovered sector (no minimum wage law) where LS = -100 + 80W and LD = 300 – 20W before the minimum wage law is put into effect. Suppose all the workers that can’t find jobs as a result of the minimum wage law enter the uncovered sector. Compute how the labor supply function changes. Calculate the equilibrium wage and employment in the uncovered sector? Draw another graph illustrating these effects. Don't copy solutions from other sites!!!!!arrow_forwardSolve Input demand and input supply Item1 : Good Q , L labor ,W wage ,A level of technology Q=A0K^alpha L^beta Q=80-P A0=1 K =36 unit L =40+0.5w alpha =0.5 beta =0.5 1. From the condition and price of the labor market equilibrium quantity in item 1, assuming that the price of good Q increases by 10% of the price of P0 Show the change in the price of the labor factor. and the amount of labor factor to be traded in the labor market And along with calculating the income size of both buyers and sellers, labor factors that should be relied on 2.Summarize the theoretical principles of the properties of demand. in factors of production and the factors affecting the change in the price of production factors are obtained when the price of production changes, the quantity of capital k changes, and the level of technology. as well as the supply characteristics of the changing factorsarrow_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