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Are unions creating a surplus of labor? Entrepreneurs asborb the risk of starting and running a company. Is Kennedy right about allowing emploers to set the wage and not the employee?
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- Entrepreneurs absorb the risk of starting and running a company. Is Kennedy right about allowing employers to set the wage and not the employee? Explain your answer.The inverse labor demand function is W = 200 – 2L, where W is the wage and L is labor. Labor revenue is WL, and labor supply is W = 2L. (a) Suppose that the labor market is competitive. What is the wage? Employment? (b) Now suppose that a union dominates the labor market. What is the wage? Employment? (c) What do you conclude about the impact of unions on labor markets?Explain four ways in which a firm might increase its profits by raising the wages it pays.
- What is the theory of efficiency wages? Provide two reasons that employers might pay efficiency wages.. [Multiple Answer] Which of the following are TRUE? a) Economists call farm price supports "welfare for the rich" b) Rent controls help to fight homelessness among the poor c) In a monopsoly (one buyer) labor market a local minimum wage is an appropriate policy d) The minimum wage does make wages more equal, but at the cost of unemployment of the least productive and often least advantaged. e) A profit maximizing firm will hire additional units of labor as long as the additional revenue from the additional units of labor is greater or equal to the additional cost of that unit of labor f) Eliminating the minimum wage would definitely lead to a "race to the bottom" until wage were redcuce to near zero. g) The number of jobs available in the economy is usually fixed in the short to medum term. h) Paying farmers to not produce is an effective way to reduce the market surplus problem resulting from an…Consider the labor market illustrated in the figure to the right. Suppose this market has a unionized sector and a nonunionized sector such that the demand for unionized workers is DU and the demand for nonunionized workers is DNU. Also assume that the supply of unionized and nonunionized labor is fixed at SL. In equilibrium, what is the market wage?
- Touch upon the idea of how labor unions advocate and defend minimum wage legislation. Research and state whether you believe this to be true or false, defend your position.true or false? The entrance of more workers into a particular labor market is likely to drive down the wage in that marketExplain ways in which a firm might increase its profits by raising the wages it pays.
- What are the welfare effects of a binding minimum wage? Use a graphical approach to show what happens if all workers are identical. Then describe in writing what is likely to happen to workers who differ by experience, education. age, gender, and race.What is the link between marginal revenue product and wages? Does this notion of marginal revenue product and wages conflict with minimum wage laws?Why does the government intervene in the market for labor? What are the consequences of its intervention?
