SL= -2 + 2w DL= 14 - 2w Draw graphs to illustrate solutions. 3. Suppose that...
SL= -2 + 2w
DL= 14 - 2w
Draw graphs to illustrate solutions.
3. Suppose that this labor market becomes monopsonistic and that the marginal cost of labor can be described by the following relation: MWC= 1 + L
3. Suppose a minimum wage of 6$ is imposed in this market. What will happen to the amount of labor hired by the firm?
4. What is the highest minimum wage that could be imposed on this market without a loss in employment?
5. What is the minimum wage that will maximize employment?
Homework Answers
Add Answer to:
SL= -2 + 2w
DL= 14 - 2w
Draw graphs to illustrate solutions.
3. Suppose that...
9. Suppose that a monopsony faces a labor supply curve of Ls-2+2w. What wage does the...
9. Suppose that a monopsony faces a labor supply curve of Ls-2+2w. What wage does the firm paw if it wants to hire 10 workers? b. What is the marginal expense of hiring an 10 worker? c. Draw a sample (or the exact) Labor Supply curve. Now add in a sample, ME curve and MRP curve such that the equilibrium is at 10 workers and at the wage from part a. Label the equilibrium level of employment and the equilibrium...
2. Suppose one firm's labor demand function is: D(u) =-2w + 50; (a) if this firm...
2. Suppose one firm's labor demand function is: D(u) =-2w + 50; (a) if this firm hires in a competitive market with the marginal expense ME- 10, then what is the employment level for this firm? (b) if there are 100 firms that are exactly the same like this one hiring labor, what is the market labor demand function? Further, assume the market sup- ply function is S(w) -300w, then what is the equilibrium market wage and employment level?
15. The following diagram shows the marginal of labor in the production of lemongrass revenue product...
15. The following diagram shows the marginal of labor in the production of lemongrass revenue product of labor and the supply Wage ($/hour) $42 14 MRPL 56 Quantity of labor Express the marginal revenue product of labor in the lemongrass industry mathematically. a. b. Express the supply of 1abor in the 1emongrass industry mathematically. If lemongrass production were many workers would be hired and what wage would they be paid? competitive in both input and output markets, how C. d....
Problem #4: Own-price elasticity Suppose the market labor demand curve is given by LD 20- (1/2)W...
Problem #4: Own-price elasticity Suppose the market labor demand curve is given by LD 20- (1/2)W and the market labor supply curve is given by LS-2W 1. Graph the labor demand curve and the labor supply curve on the same graph (with L on the horizontal axis and W on the vertical axis, as we have done in class). 2. Determine the equilibrium employment (L") and wage (W") in this market. Now suppose the government implements a minimum wage (WM)...
Problem #4: Own-price elasticity Suppose the market labor demand curve is given by LD-20-(1/2)W and the...
Problem #4: Own-price elasticity Suppose the market labor demand curve is given by LD-20-(1/2)W and the market labor supply curve is given by LS-2 1. Graph the labor demand curve and the labor supply curve on the same graph (with L on the horizontal axis and W on the vertical axis, as we have done in class) 2 Determine the equilibrium employment (L') and wage (W) in this market 3. Now suppose the government implements a minimum wage (WM) of...
2. (60 points total) Please show all work Suppose the labor supply for a firm is...
2. (60 points total) Please show all work Suppose the labor supply for a firm is given by: and REAL Labor Demand is given by. ND 120 2N a)(5 points) What is the market clearing real wage and level of employment? b)lS points) Suppose the government imposed a minimum real wage of 30. How many workers are willing to work at a real wage of 30?
3. Illustrate graphically Suppose that a competitive firms marginal cost of producing output 2 is given...
3. Illustrate graphically Suppose that a competitive firms marginal cost of producing output 2 is given by MC(q)= 70+6q Assume that the market price of the firm's product is $145. A. At what level of output will the firm produce? B. How much is the firm's producer surplus? C. Illustrate graphically profit maximization point and producer surplus. D. Illustrate this market at a loss. Explain. 4. Graphically illustrate a perfectly competitive firm and a non-perfectly competitive firm side by side....
Suppose an individual has 40 hours to work. Suppose also the individual has a net wealth...
Suppose an individual has 40 hours to work. Suppose also the individual has a net wealth outside the labor market of 100$. Suppose the wage rate is equal to 20 $ per hour. Graph the budget constraint. Suppose the marginal rate of substitution between consumption (C) and leisure (l) is equal to h−l 100c . What will a utility maximizing consumer choice between labor and consumption be? Suppose the wage falls to 5 2 $ per hour. What is the...
2. Suppose the firm has the one variable production function Q=L?. Assume that the wage rate...
2. Suppose the firm has the one variable production function Q=L?. Assume that the wage rate is w= 20 and that the firm has fixed costs of 10. Finally, assume that the firm is a price taker and the market price is 2. a) Show that this production function exhibits increasing returns to scale. Show that the marginal product of labor is increasing. Illustrate the production function. Is it convex, concave or neither? b) Find the variable and total cost...
1 Suppose that wages paid to both factory workers and construction workers in a perfectly competitive...
1 Suppose that wages paid to both factory workers and construction workers in a perfectly competitive factor market is $15 per hour. If the market for factory workers becomes unionized, you would expect: a. an increase in the wage rate for construction workers. b. an increase in the supply of factory workers. c. an increase in the wage rate for factory workers. d. no change in the wage rate for either factory workers or construction workers. 2 Marginal cost is...
9. Suppose that a monopsony faces a labor supply curve of Ls-2+2w. What wage does the firm paw if it wants to hire 10 workers? b. What is the marginal expense of hiring an 10 worker? c. Draw a sample (or the exact) Labor Supply curve. Now add in a sample, ME curve and MRP curve such that the equilibrium is at 10 workers and at the wage from part a. Label the equilibrium level of employment and the equilibrium...
2. Suppose one firm's labor demand function is: D(u) =-2w + 50; (a) if this firm hires in a competitive market with the marginal expense ME- 10, then what is the employment level for this firm? (b) if there are 100 firms that are exactly the same like this one hiring labor, what is the market labor demand function? Further, assume the market sup- ply function is S(w) -300w, then what is the equilibrium market wage and employment level?
15. The following diagram shows the marginal of labor in the production of lemongrass revenue product of labor and the supply Wage ($/hour) $42 14 MRPL 56 Quantity of labor Express the marginal revenue product of labor in the lemongrass industry mathematically. a. b. Express the supply of 1abor in the 1emongrass industry mathematically. If lemongrass production were many workers would be hired and what wage would they be paid? competitive in both input and output markets, how C. d....
Problem #4: Own-price elasticity Suppose the market labor demand curve is given by LD 20- (1/2)W and the market labor supply curve is given by LS-2W 1. Graph the labor demand curve and the labor supply curve on the same graph (with L on the horizontal axis and W on the vertical axis, as we have done in class). 2. Determine the equilibrium employment (L") and wage (W") in this market. Now suppose the government implements a minimum wage (WM)...
Problem #4: Own-price elasticity Suppose the market labor demand curve is given by LD-20-(1/2)W and the market labor supply curve is given by LS-2 1. Graph the labor demand curve and the labor supply curve on the same graph (with L on the horizontal axis and W on the vertical axis, as we have done in class) 2 Determine the equilibrium employment (L') and wage (W) in this market 3. Now suppose the government implements a minimum wage (WM) of...
2. (60 points total) Please show all work Suppose the labor supply for a firm is given by: and REAL Labor Demand is given by. ND 120 2N a)(5 points) What is the market clearing real wage and level of employment? b)lS points) Suppose the government imposed a minimum real wage of 30. How many workers are willing to work at a real wage of 30?
3. Illustrate graphically Suppose that a competitive firms marginal cost of producing output 2 is given by MC(q)= 70+6q Assume that the market price of the firm's product is $145. A. At what level of output will the firm produce? B. How much is the firm's producer surplus? C. Illustrate graphically profit maximization point and producer surplus. D. Illustrate this market at a loss. Explain. 4. Graphically illustrate a perfectly competitive firm and a non-perfectly competitive firm side by side....
2. Suppose the firm has the one variable production function Q=L?. Assume that the wage rate is w= 20 and that the firm has fixed costs of 10. Finally, assume that the firm is a price taker and the market price is 2. a) Show that this production function exhibits increasing returns to scale. Show that the marginal product of labor is increasing. Illustrate the production function. Is it convex, concave or neither? b) Find the variable and total cost...
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