Consider the labor market for the fast-food industry, which consists mainly of high school and college students. Assume that all fast-food restaurants are profit maximizing. The following calculator shows the market demand curve (blue curve) and market supply curve (orange curve) for student workers, who are responsible for making hamburgers. At any time in this problem, you can click the Reset to Initial Values button to return the elements in the calculator to their original positions. You will not be graded on any changes to the calculator; it's just here to help you answer the following questions. Tool tip: You can directly change the values in the boxes with the white background by clicking in the box and typing. The graph and any related values will change accordingly. WAGE RATE 20 18 16 14 12 10 8 6 X 0 10 20 30 40 50 60 JANTITY OF LABOR (Thousands of workers) 70 80 90 100 Graph Input Tool LABOR MARKET CALCULATOR Wage rate Labor demanded (Thousands of workers) Price of a hamburger (Dollars) 14 30 4 Labor supplied (Thousands of workers) 70 When the price of a hamburger is $4, the equilibrium wage in the fast-food labor market is $10 per hour. Suppose that the demand for hamburgers increases enough so that the price of a hamburger rises to $8 Ordinarily this would result in a pow.cquilibr
Consider the labor market for the fast-food industry, which consists mainly of high school and college students. Assume that all fast-food restaurants are profit maximizing. The following calculator shows the market demand curve (blue curve) and market supply curve (orange curve) for student workers, who are responsible for making hamburgers. At any time in this problem, you can click the Reset to Initial Values button to return the elements in the calculator to their original positions. You will not be graded on any changes to the calculator; it's just here to help you answer the following questions. Tool tip: You can directly change the values in the boxes with the white background by clicking in the box and typing. The graph and any related values will change accordingly. WAGE RATE 20 18 16 14 12 10 8 6 X 0 10 20 30 40 50 60 JANTITY OF LABOR (Thousands of workers) 70 80 90 100 Graph Input Tool LABOR MARKET CALCULATOR Wage rate Labor demanded (Thousands of workers) Price of a hamburger (Dollars) 14 30 4 Labor supplied (Thousands of workers) 70 When the price of a hamburger is $4, the equilibrium wage in the fast-food labor market is $10 per hour. Suppose that the demand for hamburgers increases enough so that the price of a hamburger rises to $8 Ordinarily this would result in a pow.cquilibr
Chapter16: The Markets For Labor, Capital, And Land
Section: Chapter Questions
Problem 13P
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