16. Suppose labor demand is given by the equation
L = 50 −2W,
where L is the number of workers and W is the wage rate.
16. Suppose labor demand is given by the equation L = 50 −2W, where L is the number of workers and W is the wage rate....
Consider the labor demand curve given by the equation 100 L = ------- W For small changes in the wage around any given point on the curve, the slope of the curve (the change in L divided by the change in W) is given by the formula 100 Slope = − -------- W 2 a. Find the slope of the curve for a small change in the wage around W = $5. b. Find...
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...
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)...
Suppose the demand for fast food workers can be defined a labor demand equation of LD = 95-3w. All fast food workers are covered by the minimum wage and it is binding. The minimum wage is increased from $7.25 to $9.00 per hour. Calculate the elasticity of demand for fast food workers over the relevant portion of the demand curve using the simple formula. Throughout your calculations round to two decimals.
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.
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...
The demand for labor in Occupation A is LD = 20 - W, where LD = number of workers demanded for that occupation, in thousands. The supply of labor for Occupation A is LA = -1.25 +.5W. For Occupation B, the demand for labor is similar, but the supply of labor is LB=-.5 +.6W, which is indicative of a more pleasant environment associated with that occupation in comparison with Occupation A. What is the compensating wage differential between the two...
Labor Economics, multiple choice questions 1. In the leisure-income model, the wage constraint shows a. the points that maximize a worker's utility b. all points that are equally preferred c. the wage rates that affect work decisions d. the available combinations of leisure and income 2. The slope of a wage constraint reflects the: a. rate at which a person is willing to substitute leisure for income c. income effect b. price of leisure d. substitution effect 3. When a...
Suppose firm j’s output is given by yj = n 1−α j , where 0 < α < 1 (α is a parameter). Suppose the firm must pay a fixed cost b < α if it wants to operate. That is, the firm’s profits are given by π (nj ) = 0 , if nj = 0 and π (nj ) = n 1−α j − wnj − b , if nj > 0 where w is the wage. (a)...
its fundamentals to economics ensures that resources are allocated to their highest-valued uses. a. Monopoly b. Government C. The consumer d. Competition e. Arbitrage Styles 3 As the wago rato increases, the quantity supplied of labor in a market will a. increase. b. decrease c. first increase and then decrease. d. first decrease and then increase. e. remain constant. 4 As the wage rate increases, the quantity demanded of labor in a market will a. increase. b. decrease. c. first...