Suppose labor demand in the United States is w = 24 − 0.1E, where E is...
Suppose labor demand in the United States is w = 24 − 0.1E, where E is the number of workers in millions and w is the hourly wage. There are 120 million domestic U.S. low-skilled workers who supply labor inelastically. If the U.S. opened its borders to immigration, 20 million low-skill immigrants would enter the U.S. and supply labor inelastically.
(a) What is the market-clearing wage if immigration is not allowed?
(b) What is the market-clearing wage with open borders, assuming domestic and immigrant low-skilled workers are substitutes in production?
(c) The immigration surplus measures the net gain in total domestic welfare (firms and workers) due to immigration. How much is the immigration surplus with open borders?
(d) How much surplus is transferred from domestic workers to domestic firms?
Homework Answers
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Suppose labor demand in the United States is w = 24 − 0.1E,
where E is...
3. Consider the graph of a low-skill labor market, where D is the demand for low-skilled...
3. Consider the graph of a low-skill labor market, where D is the demand for low-skilled workers by business firms, and S is the supply of native-bon U.S. workers who offer their labor services in the low-skill labor market. Show the shift that occurs with large-scale immigration of low-skilled workers into the United States. What is the effect on the wage on employment of native- born workers? Wage Rate ($ per hour) Employment (number of workers)
6. Low-skilled workers operate in a competitive market. The labor supply is Q 10W (where W is the...
6. Low-skilled workers operate in a competitive market. The labor supply is Q 10W (where W is the price of labor measured by the hour- ly wage) and the demand for labor is Q 240 20W. Q measures the quantity of labor hired (in thousands of hours). a. What is the equilibrium wage and quantity of low-skilled labor working in equilibrium? b. If the government passes a minimum wage of $9 per hour, what will the new quantity of labor...
6. Low-skilled workers operate in a competitive market. The labor supply is Q 10W (where W...
6. Low-skilled workers operate in a competitive market. The labor supply is Q 10W (where W is the price of labor measured by the hourly wage) and the demand for labor is Q 240 20W. Q measures the quantity of labor hired (in thousands of hours). a. What is the equilibrium wage and quantity of low-skilled labor working in equilibrium? b Ifthe government passes a minimum wage of $9 per hour, what will be the new quantity oflabor hired will...
PLS ANSWER ALL ASAP!! THANK YOU!!!! 49. If immigrant workers are complementary to n dive workers,...
PLS ANSWER ALL ASAP!! THANK YOU!!!!
49. If immigrant workers are complementary to n dive workers, then A. native workers will be better off with open orders. B. immigrant workers will receive a higher we athan native workers. C. immigration will shift the demand for native abor to the left D. there will be no immigration surplus. E. each firm will hire only immigrants or only ne ives but not a mixture of the two. 50. A perfectly discriminating monopsonis...
The wage rate in a labor market is $20. At this wage, firms hire 300 million...
The wage rate in a labor market is $20. At this wage, firms hire 300 million hours of work and workers supply 300 million hours. The elasticity of labor demand is -0.2 and the elasticity of labor supply is 0.1. Then the government imposes a payroll tax of $1 per hour of work on firms. After the tax is imposed, [15 points] How much does it cost firms to hire an hour of labor, including cash wage plus tax?...
Consider the following model of the labor market in the United States. Suppose that the labor...
Consider the following model of the labor market in the United States. Suppose that the labor market consists of two parts, a market for skilled workers and the market for unskilled workers, with different demand and supply curves for each as given below. The initial wage for skilled workers is $20 per hour; the initial wage for unskilled workers is $7 per hour. a. Draw the demand and supply curves for the two markets so that they intersect at the...
The graph on the right shows the demand for and supply of labor in a market...
The graph on the right shows the demand for and supply of labor in a market with an equilibrium wage rate of $9 per hour. Labor supply Show the impact on the graph if a minimum wage of $11 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 $11 per hour. Label your point 'A.' 2.) Using the point drawing tool, plot...
3. The demand and supply functions for labor are as follows: Supply: L0.5w where Ld is...
3. The demand and supply functions for labor are as follows: Supply: L0.5w where Ld is the number of workers demanded by firms, L' is the number of workers supplied by households, and w is the wage per worker (i.e. the price of labor). Solve for the equilibrium wage and the equilibrium number of workers. Illustrate this equilibrium in a graph with w on the vertical axis and L on the horizontal axis. a. b. Suppose the government sets a...
Suppose in a particular labor market, the demand for labor is given by the equation LD...
Suppose in a particular labor market, the demand for labor is given by the equation LD = 120 – 3W and that the labor supply in this market for native-born citizens is given by LN = 3W, while the supply curve of immigrants in this market is given by LI = 2W, where L represents the number of workers, W is the wage expressed in real terms.
3. Consider the graph of a low-skill labor market, where D is the demand for low-skilled workers by business firms, and S is the supply of native-bon U.S. workers who offer their labor services in the low-skill labor market. Show the shift that occurs with large-scale immigration of low-skilled workers into the United States. What is the effect on the wage on employment of native- born workers? Wage Rate ($ per hour) Employment (number of workers)
6. Low-skilled workers operate in a competitive market. The labor supply is Q 10W (where W is the price of labor measured by the hour- ly wage) and the demand for labor is Q 240 20W. Q measures the quantity of labor hired (in thousands of hours). a. What is the equilibrium wage and quantity of low-skilled labor working in equilibrium? b. If the government passes a minimum wage of $9 per hour, what will the new quantity of labor...
6. Low-skilled workers operate in a competitive market. The labor supply is Q 10W (where W is the price of labor measured by the hourly wage) and the demand for labor is Q 240 20W. Q measures the quantity of labor hired (in thousands of hours). a. What is the equilibrium wage and quantity of low-skilled labor working in equilibrium? b Ifthe government passes a minimum wage of $9 per hour, what will be the new quantity oflabor hired will...
PLS ANSWER ALL ASAP!! THANK YOU!!!!
49. If immigrant workers are complementary to n dive workers, then A. native workers will be better off with open orders. B. immigrant workers will receive a higher we athan native workers. C. immigration will shift the demand for native abor to the left D. there will be no immigration surplus. E. each firm will hire only immigrants or only ne ives but not a mixture of the two. 50. A perfectly discriminating monopsonis...
The graph on the right shows the demand for and supply of labor in a market with an equilibrium wage rate of $9 per hour. Labor supply Show the impact on the graph if a minimum wage of $11 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 $11 per hour. Label your point 'A.' 2.) Using the point drawing tool, plot...
3. The demand and supply functions for labor are as follows: Supply: L0.5w where Ld is the number of workers demanded by firms, L' is the number of workers supplied by households, and w is the wage per worker (i.e. the price of labor). Solve for the equilibrium wage and the equilibrium number of workers. Illustrate this equilibrium in a graph with w on the vertical axis and L on the horizontal axis. a. b. Suppose the government sets a...
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