How does the amount of employment created by an increase in the minimum wage depend on the elasticity of labor demand? Group of answer choices: a. When the minimum wage increases, employment will fall by a greater amount when the demand for labor is more elastic. b. When the demand for labor is more elastic, raising the minimum wage has no impact on employment. c. When the demand for labor is more inelastic, raising the minimum wage has no impact on employment. d. When the minimum wage increases, employment will fall by a greater amount when the demand for labor is more inelastic.

How does the amount of employment created by an increase in the minimum wage depend on the elasticity of labor demand? Group of answer choices: a. When the minimum wage increases, employment will fall by a greater amount when the demand for labor is more elastic. b. When the demand for labor is more elastic, raising the minimum wage has no impact on employment. c. When the demand for labor is more inelastic, raising the minimum wage has no impact on employment. d. When the minimum wage increases, employment will fall by a greater amount when the demand for labor is more inelastic.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter6: Supply, Demand And Government Policies

Section: Chapter Questions

Problem 8PA

See similar textbooks

Similar questions

If the demand for unskilled labor were inelastic, would the proposed increase in the minimum wage raise or lower total wage payments to unskilled workers? Would your answer change if the demand for unskilled labor were elastic? (100 – 150 words )
Show the diagram or graph for the question of, Assume that the supply of low-skilled workers is fairly elastic, but the employers demand for such workers is fairly inelastic, is it better to focus on policy tools to shift the supply of unskilled labor or on tools to shift the demand for unskilled labor?
When the wage was $10 per hour, a group of workers supplied 30 hours of work per week on average. The wage then increased to $15 per hour, and the same group of workers supplied 35 hours of work per week on average. What is the elasticity of labor supply for this group of workers?
Draw a supply-demand diagram representing the impact of a minimum wage in the labor market. What does economic theory predict about the change in employment with the introduction of or increase in a minimum wage? How does the prediction above vary with elasticity of labor supply and labor demand?
A case study dicusses the federal minimum wage law.a. Suppose the minimum wage is above the equilibrium wage in the market for unskilled labor. using the supply and demand diagram of the market for unskilled labor, show the market wage,the number of workers who are employed, and the number of workers who are unemployed. Also show total payment to unskilled workers.b. Now suppose the secretary of labor proposes an increase in the minimum wage.What effect would this increase have on employment? does the change in employment depend on the elasticity of demand, the elasticity of supply, both elasticities, or neither?c. What effect would this increase in the minimum wage have on unemployment? Does the change in unemployment depend on the elasticity of demand, the elasticity of supply, both elasticities or neither?d.if the demand for unskilled labor were inelastic, would the proposed increase in the minimum wage raise or lower total wage payments to the unskilled workers. would you answer…
The government decides to regulate the labor market. Assume the demand for labor is inelastic, while the supply of labor is elastic.a) On a graph, show the equilibrium wage and the employment level. Make sure you label the axes and the curves.b) The government decides to introduce minimum wage: now it’s illegal to offer wage below the minimum wage level. On a graph, show how the market will be affected if the minimum wage is set to be above the equilibrium wage. What wage will be offered on the market? What will happen to the employment level? What negative consequences will this government intervention have?c) Forget about part (b). The government decides to introduce a tax on every worker. On a new graph, without showing any shifts of the curves, show the new wage you’d observethe firms to pay and the wage you’d observe households to receive. Comment on the tax incidence: who will bear most of the burden of the tax? Problem 3: Consumer surplus and producer surplusOn the market for…
Draw a graph of the market for U.S. labor. Label axes, curves, and equilibrium quantity and wages. (You do not have to use actual numbers) The supply of workers is highly, but not perfectly elastic. Make sure this elasticity is represented on your graph. Then, draw, on a separate graph, what would happen to that market if there was an influx of immigrant workers who are complements of U.S. native workers.
The deadweight loss associated with a tax on labor income is higher if the supply of labor is relatively ________. a. elastic b. inelastic c. elastic or inelastic as elasticity does not influence deadweight loss.
A more elastic labor supply shows that hours worked is more responsive to changes in tax rates. True or false?
Which one is CORRECT about the effects of tax on welfare as compared to without tax? A. Consumer surplus will rise B. Producer surplus will rise C. Tax revenue will rise D. Total surplus will rise E. All of the above The effect of tax on deadweight loss becomes smaller when: A. demand is inelastic B. demand is elastic C. supply is inelastic D. supply is elastic E. A and C F. B and D Which one is CORRECT about the marginal and average costs? A. Marginal cost crosses both average variable cost and average total cost at their minimum points. B. Average fixed cost increases continuously as the level of output increases. C. Whenever marginal cost is greater than average total cost, average total cost is rising. D. All of the above Which of the following is an example of implicit costs? A. payments made by the firm to others B. opportunity cost of resources owned…
Assume that the supply of low-skilled workers is fairly elastic, but the employers’ demand for such workers is fairly inelastic. If the policy goal is to expand employment for low-skilled workers, is it better to focus on policy tools to shift the supply of unskilled labor or on tools to shift the demand for unskilled labor? Sketch a graph to help compare and contrast the two options.
Assume that the supply of low-skilled workers is fairly elastic, but the employers’ demand for such workers is fairly inelastic. If the policy goal is to expand employment for low-skilled workers, is it better to focus on policy tools to shift the supply of unskilled labor or on tools to shift the demand for unskilled labor? What if the policy goal is to raise wages for this group? Explain your answers with supply and demand diagrams.