A minimum wage set above the equilibrium wage will create a shortage of labour .a O have no effect because the equilibrium level of employment is not affected by a minimum wage above the b O equilibrium wage will create a surplus of labour .c O .create a lower wage rate for skilled workers than for unskilled workers .d O

A minimum wage set above the equilibrium wage will create a shortage of labour .a O have no effect because the equilibrium level of employment is not affected by a minimum wage above the b O equilibrium wage will create a surplus of labour .c O .create a lower wage rate for skilled workers than for unskilled workers .d O

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter4: Labor And Financial Markets

Section: Chapter Questions

Problem 20RQ: Whether the product market or the labor market, what happens to line equilibrium price and quantity...

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Whether the product market or the labor market, what happens to line equilibrium price and quantity for each of the four possibilities: increase in demand, decrease in demand, increase in supply; and decrease in supply.
Under what Circumstances would a minimum wage be a nonbinding price floor? Under what circumstances would a living wage be a binding price floor?
What is die price commonly called in the labor market?
Other than the demand for labor, what would be another example of a 'derived demand?
A government passes a family-friendly law that no companies can have evening, nighttime, or weekend hours, so that everyone can be home with their families during these times. Analyze the effect of this law using a demand and supply diagram for the labor market: first assuming that wages are flexible, and then assuming that wages are sticky downward.
What would be a sign of a shortage in financial markets?
In the labor market, what causes a movement along the supply curve? What causes a shift in the supply curve?
Assume that the supply of law-skilled worker is fairly elastic, but the employers demand for such workers is fairly inelastic. If the policy goal is to expand employment for low-skilled workers, is it better to focus on policy tools to shift the supply of unskilled labor or on tools to shift the demand for unskilled labor? What if the policy goal is to raise wages for this group? Explain your answer with supply and demand diagrams.
Predict how each of the following events will raiseor lower the equilibrium wage and quantity of oilworkers in Texas. In each case, sketch a demand andsupply diagram to illustrate your answer.a. The price of oil rises.b. New oil-drilling equipment is invented that ischeap and requires few workers to run.c. Several major companies that do not drill oilopen factories in Texas, offering many well-paidjobs outside the oil industry.d. Government imposes costly new regulations tomake oil-drilling a safer job
The graph shows a market for labor Draw a line that atrales a minimum wage that creates unemployment of 3 million hours a year Label t OA price floor OB quantity celing OC price celing OD quarty foor 400 5.50 100 450- 4004 3.50 300 250 2004 Wage a las per hour * 2007 zis-a zis No 250 260 Qty of hours per year **Draw only the objects specified in the question
Illustrate and explain the impact of a minimum wage on the demand and suppy labour market.
↓ The graph illustrates a labor market in which there is a minimum wage of $5 an hour Draw shapes that represent the following 1) firms' surplus Label it FS 2) workers' surplus. Label it WS 3) deadweight loss. Label it DWL 4) the potential loss from job search Label it Loss >>> A label can be repositioned by clicking on the edge of the label box and dragging it onto the shape Wage rate (dollars per hour) FS 3- 0+ 18 19 (18,2) Minimum wage D 24 25 21 22 23 20 Quantity (millions of hours per year) a G