# Graph Input ToolMarket for Labor20.0I Wage(Dollars per hour)2.5017.5SupplyLabor Supplied(Thousands ofworkers)Labor Demanded(Thousands ofworkers)15.087512512.510.07.5Demand5.02.5125250375500625750875 1000LABOR (Thousands of workers)Complete the following table with the quantity of labor supplied and demanded if the wage is set at \$7.50. Then indicate whether this wage will resultin 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 SuppliedLabor Demanded(Thousands of workers)(Thousands of workers)Shortage or Surplus?Wage\$7.50Suppose a senator considers introducing a bill to legislate a minimum hourly wage of \$7.50.Which of the following statements are true? Check all that apply.WAGE (Dollars per hour) Complete the following table with the quantity of labor supplied and demanded if the wage is set at \$7.50. Then indicate whether this wage will resultin 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 SuppliedLabor Demanded(Thousands of workers)Shortage or Surplus?(Thousands of workers)Wage\$7.50Suppose a senator considers introducing a bill to legislate a minimum hourly wage of \$7.50.Which of the following statements are true? Check all that apply.If the minimum wage is set at \$10.50, the market will not reach equilibrium.In this labor market, a minimum wage of \$7.50 is binding.In the absence of price controls, a shortage puts upward pressure on wages until they rise to the equilibrium.Binding minimum wages cause frictional unemployment.

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Step 1

In this graph we can see that the wage rate is set at \$2.5 per hour, as we extend the wage line (green), it cuts the supply curve where the labor supplied is 125,000 units. Similarly, it cuts the demand curve where the labor demanded is 875,000 units.

Step 2

Now, if the wage rate is \$7.5 per hour we can further understand from the graph below:

Step 3

At this wage rate the labor demanded is where the wage line cuts the demand curve which is 625,000 units. Similarly, the labor supplied is where the wage line cuts the supply curve which ...

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