a. Given the supply and demand for labor services, where wage is the price of labor services, explain the impact of a minimum wage above the equilibrium wage on employment. Draw a graph to illustrate this and explain the graph in words.
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- Why are the factors that shift the demand for a product different from the factors that shift the demand for labor? Why are the factors that shift the supply of a product different from those that shift the supply of labor?What is die price commonly called in the labor market?In the labor market, what causes a movement along the supply curve? What causes a shift in the supply curve?
- 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.Name some factors that can cause- a shift in the supply curve in labor markets.What is the formula for the wage elasticity of labor 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?Predict how each of the following events will raise or lower the equilibrium wage and quantity of oil worker in Texas. In each case, sketch a demand and supply diagram to illustrate your answer. The price of oil rises. New all-drilling equipment is invented that is cheap and requires few workers to run. Several major companies that do not drill oil open factories in Texas, offering many well-paid jobs outside the oil industry. Government imposes costly new regulations to make oil-drilling a safer job.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.Consider the labor market defined by the supply and demand curves plotted on the following graph. Use the calculator to help you answer the following questions. You will not be graded on any changes you make to the calculator. WAGE (Dollars per hour) 24 21 18 3 0 Supply Demand 150 300 450 600 750 900 1050 1200 LABOR (Thousands of workers) Graph Input Tool Market for Labor Wage (Dollars per hour) Labor Demanded (Thousands of workers) 3.00 1,050 Labor Supplied (Thousands of workers) Complete the following table with the quantity of labor supplied and demanded if the wage is set at $9.00. Then indicate whether this wage will result in a shortage or a surplus. Hint: Be sure to pay attention to the units used on the graph and in the table. For example, type in 100 for 100,000 workers. Labor Demanded Labor Supplied Wage (Thousands of workers) (Thousands of workers) Shortage or Surplus? $9.00 Suppose the federal government contemplates a new law that would create a national minimum wage of…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
