In a competitive labor market, employers will not pay less than the market wage because at a wage below the equilibrium A) the equilibrium wage would rise B) they would not be able to hire anyone O C) there would be a surplus of workers D) they would be inundated with excess workers

In a competitive labor market, employers will not pay less than the market wage because at a wage below the equilibrium A) the equilibrium wage would rise B) they would not be able to hire anyone O C) there would be a surplus of workers D) they would be inundated with excess workers

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter12: Labor Markets And Labor Unions

Section: Chapter Questions

Problem 1.1P

See similar textbooks

Related questions

Q: Larry’s Lumber Mill sells lumber in a perfectly competitive product market. However, Larry’s Lumber…

A: perfect competition refers to a theoretical market structure in which the following criteria are…

Q: Q4. Suppose the firm sells its output according to the following demand schedule: Labor Total…

A: Answer; Below I attached your answer

Q: A firm will be better off by hiring an additional worker only when: The overall benefit is greater…

A: A firm will be better off by hiring an additional worker only.

Q: Economics Operum is a firm that hires unskilled laborers in a perfectly competitive factor market.…

A: Note: “Since you have posted a question with multiple sub-parts, we will solve the first three…

Q: Q) The market demand for the output is P= 80 - Q, where Q is the output level and P is the price per…

A: Given that:- Price of labor at the competitive equilibrium in the labor market…

Q: The Levee Spa is a profit-maximing company wanting to hire workers up to the point where the market…

A: The situation which depicts many sellers selling products that are heterogeneous in nature to…

Q: The demand for carpenters is driven by demand for wood furniture produced by that labor. This…

Q: A school district received 750 applications for 10 new openings. What does this tell you about the…

A: Number of applications=750Number of openings=10From this,we can say that number of application is 75…

Q: Suppose a campus restaurant increases the number of workers it hires from 3 workers per day to 11…

A: Given: Increase in the number of workers from 3 workers per day to 11 workers per day The total…

Q: A firm will be better off by hiring an additional worker only when: O The overall benefit is greater…

A: Profit maximisation is the ultimate goal of firms operating in the market. Hiring decisions depend…

Q: The market demand for the output is P = 80 – Q, where Q is the output level and P is the price per…

A: Labour market is in equilibrium where demand for labor and supply for labour are equal to each other…

Q: A firm’s technology requires it to combine 5 person-hours of labor with 3 machinehours to produce 1…

A: Given Required hours of labor = 5 Required hours of machine = 3 Total number of machine = 15 Old…

Q: Policymakers sometimes propose laws re3quiring firms to give workers certain fringe benefits, such…

A: The fringe benefits provided by the firms to the workers increase the benefits received by the…

Q: The collective wage is normal: O Higher than the equilibrium wage W * O Lower than the maximum wage…

A: In economics, collective wage refers to the wage rate that is set by making negotiation between…

Q: Consider a firm with d = 0. If the equilibrium wage rate is lower for women than for men (WF < WM),…

A: When a firm enters the labor market, it will try to maximize its benefits by minimizing the cost of…

Q: ||

A: 8 adminstrative officers would be hired.

Q: Which one of the following labor resources will likely have the most inelastic supply schedule in…

A: Inelastic supply means, change in price (wage) does not make drastic impact on the supply of labor.

Q: Select one or more: O a. A rise in labour supply will lead to a rise in wages b. Given a constant…

A: In the labor market, any change in labor supply or labor demand will lead to affect the market…

Q: Assume the demand for labor for each firm is expressed as L = N (# of employees) x HBAR(average…

A: demand for labour =L= N(number of employees) x HBAR(average hours per employee per day). A firm has…

Q: When the price of a firm's good or service falls, then the firm's demand curve for labor will shift…

A: Derived demand, depending on labor productivity, the firm's earnings, demand for firms' services and…

Q: A cost-minimizing firm that has only 1 type of input will have its marginal factor cost equal to its…

A: Cost minimization is a financial strategy aimed at achieving the most cost-effective method of…

Q: Define and show worker surplus and producer surplus in a competitive labor market.

A: The labor market refers to the place where the job seekers and the job providers meet. The labor…

Q: A firm that is perfectly competitive in the output market faces a demand curve for its output: P =…

A: A firm that is perfectly competitive in the output market faces a demand curve for it's output P= MR…

Q: Consider an INCREASE in the wage (as demanded by the labor groups) to a higher level than the…

A: Here, it is given that the market wage is higher than the equilibrium price for labor, that is the…

Q: arry’s Lumber Mill sells lumber in a perfectly competitive product market. However, Larry’s Lumber…

A: Monopsony market exists where only single buyer is available in the market. it happens in the labor…

Q: Refer to the following table Labor Output Price 0 0 1 16 $7 2 31 $7 3 45 $7 4 58 $7 5 69 $7 6 78…

A: Labor Output Price MPL VMPL 0 0 --- ---- ---- 1 16 7 16 112 2 31 7 15 105 3 45 7 14 98 4…

Q: Suppose a firm purchases labor in a competitive labor market and sells it product in a competitive…

A: Using the following formula: Price elasticity of demand = percentage change in quantity demanded/…

Q: In a purely competitive labor market (a), market labor supply S and market labor demand D determine…

A: The market is a place where the buyers and sellers interact with each other and the exchange of…

Q: The reason that the supply curve for labor in a purely competitive market rises is because: Multiple…

A: Labor Supply Curve shows the relationship between the quantity of labor supplied at different wages.…

Q: A firm in a perfectly competitive labor market is employing labor where the marginal revenue product…

A: "A firm in a perfectly competitive labor market hire labor upto a point where the marginal revenue…

Q: Suppose the supply curve of lab assistants is given by w = 8 + 6E, while the demand curve is given…

A: At the equilibrium level both demand and supply are equal to each other.

Q: True or false explain this a) In a competitive labor market, the price of labor is determined by…

A: As economies emerged, goods and services were produced that required machinery and labour. With time…

Q: In a competitive labor market for bakers, the equilibrium wage rate A. rises if the market price of…

A: Equilibrium wage rate is determined where labor demand equals labor supply.

Q: A firm hires labor in a perfectly competitive labor market. Its current profit-maximizing hourly…

A: Any firm will have the motive of maximizing its profit. Thus for the last worker hired the marginal…

Q: The table below shows levels of employment (Labor), the marginal product at each of those levels,…

A: a) Value of marginal product, MRPL=MPL×P Therefore, MRPL=7×3=…

Q: In a purely competitive labor market (a), market labor supply S and market labor demand D determine…

A: The supply of labor shows all the combinations of wage rates and the quantity of labor supplied at…

Q: Which of the following would increase the supply of labor? There’s a decrease in the number of…

A: Supply is the total quantity of products and services that the producer manufacture to sell in the…

Q: Billy is hiring workers to help him install solar panels. The table below presents the marginal…

Q: Suppose that a firm's production function is given by: 150- Q = 14L -12 140- 130- 120- 110- 100- for…

A: A firm's demand curve (dd) for labor can be derived by multiplying the MPL (marginal product of…

Q: The table below shows the quantity demanded and supplied in the labor market for nurses in the town…

A: a. The equilibrium is determined by the demand and supply curve in the market so if there is not…

Q: If the efficiency wage theory holds, there will be enough jobs for everyone. workers with jobs will…

A: The labor demand curve is negatively sloped and it shows the inverse relationship between wage rate…

Q: Suppose demand for labor is given by the equation P = 75 – 20 and the supply for labor is given by…

Q: Consider a perfectly competitive labor market in which a binding minimum wage is imposed. For this…

A: Minimum wage refers to the lowest wage set up by the law or permitted by special agreement

Concept explainers

Labor Force Participation Rate analysis

The labor force participation rate analysis calculates the percentage of the working-age population either employed or actively seeking work. It can be anyone in the age category of 16 to 64, on the condition that they are not institutionalized. A high labor force participation rate shows that more people are employed and contributing their wages to the economy, making it a healthy economy. It also shows that there are more people actively looking for employment leading to more hiring options for employers. On the other hand, a low labor force participation rate shows a low number of people employed or looking for work. This leads to an economic setback with fewer wages going into the economy. In such a scenario, employers might have to cut back on profits, lay off employees, or stop the process of hiring.

Question

In a competitive labor market, employers will not pay less than the market wage
because at a wage below the equilibrium
A) the equilibrium wage would rise
B) they would not be able to hire anyone
C) there would be a surplus of workers
D) they would be inundated with excess workers

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Which one of the following labor resources will likely have the most inelastic supply schedule in the short run? a.construction laborers b.filling station attendants c.dentists d.sales clerks
A school district received 750 applications for 10 new openings. What does this tell you about the wages offered for this position in relation to the equilibrium wage? Explain.
Problem 4 Consider a labor market. Quantity supplied is given by Qs=1000+20*P. Quantity demanded is given by Qd=1307.5-0.5*P Plot these curves on a graph with 5 points at P=5,10,15,20,25
Suppose the firm only produces good X and that the price of good Y, a substitutegood, decreases. What will happen to the optimal quantity of labor the firm willhire? Explain.
Consider the labor market for the cleaning products industry. Assume, decrease in the demand for cleaning products takes place in the industry. What is the likely consequence? Odecrease in demand for labor Oincrease in supply of labor Oincrease in demand for labor What will be the impact on the wage rate (other things equal)? Odecrease in wage rate Oincrease in wage rate Othere will be no change
Which would decrease the demand for a particular type of labor? An increase in the prices of the resources that are complements to that type of labor An increase in the wages of that type of labor X An increase in the demand for the products produced by that type of labor A decrease in the prices of those resources that are complements for that type of labor
Question 1 Candice's' Cookies is a new cookie delivery company in Gainesville, Florida. The firm hires local college students to sell cookies door-to-door in higher income neighborhoods. Each of these "Sales Associates" sells cookies, which increases Candice's Cookies' total revenue, but must be paid an hourly wage. The graph below depicts Candice's Cookies' demand for labor curve when the retail price of a cookie is $2. $35 Hourly Wage C. 3 cookies D. 4 cookies E. 5 cookies $30 $25 $20 $15 $10 $5 6 8 10 12 14 Number of Sales Associates Part (i): Suppose that the retail price of a cookie is $2.50. What is the marginal product of the 4th Sales Associate? A. 1 cookie B. 2 cookies Part (ii): Suppose that the retail price of a cookie is $2.50. What is the marginal product of the 6th Sales Associate? A. 1 cookie B. 2 cookies C. 3 cookies D. 4 cookies E. 5 cookies Part (iii): Suppose that the retail price of a cookie is $2.50. What is the marginal product of the 8th Sales Associate? A. 1…
True or false explain this a) In a competitive labor market, the price of labor is determined by the industry that hires the labor. b) In a competitive labor market if the wage is $10.00 than the MRC of labor is $10.00. c) labor and capital can never be substituted for each other. Explain it early
Suppose a firm purchases labour in a competitive labour market and sells its product in a competitive product market. The firm’s elasticity of demand for labour is 0.4. Suppose further that the wage increases by 5 percent. What will happen to the amount of labour hired by the firm?
A firm faces a perfectly elastic demand for its output at a price of $6 per unit of output. The firm, however, faces an upward-sloped labor supply curve ofE = 20w - 120where E is the number of workers hired each hour and w is the hourly wage rate. Thus, the firm faces an upward-sloped marginal cost of labor curve ofMCE = 6 + 0.1EEach hour of labor produces five units of output. How many workers should the firm hire each hour to maximize profits? What wage will the firm pay? What are the firm’s hourly profits?
The demand for labor is called OAbsolute demand ODerived demand OMinimum wage demand OActual demand because OThe demand for the labor is dependent on the demand for the products produced by the firms OThe demand for labor is determined by the minimum wage OThe demand for labor is determined by the supply of labor OThe demand for labor is acutally greater than the demand for the product
1. The market price for tomatoes is $2/pound. Lynn is too small to influence the price of tomatoes. Her tomato (short-run) production function is given by q= L3 where L measures hours of labor and q measures pounds of tómatoes. (a) demand curve for labor. Lynn hires labor from a competitive labor market. Find her short run (b) elastic than her short-run demand for labor? Explain your answer. Would you expect Lynn's long-run demand for labor to be more or less