If labor supply is perfectly inelastic, the imposing a payroll tax that will be split between employers and employees will a) reduce employment. b) leave employment levels unchanged. c) cause the tax burden to fall exclusively on firms. d) cause the tax burden to fall exclusively on workers.
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- Referred to the above graph of the labor market. The government decides to impose a wage tax as shown on the graph. If the number of workers hired after the imposition of the tax is 800 then the total amount of tax is $___If the tax elasticity of labor supply is 0.24, by what percentage will the quantity of labor supplied increase in response to a. a $500 per person income tax rebate?multiple choice A 4.8 percent increase A 1.2 percent increase No increase A 2.4 percent increase b. a 9 percent reduction in marginal tax rates? %The income effect on labor supply is likely to be a. small because most people don't have the ability to change labor supply on the intensive margin b. large because most people can change labor supply on the intensive margin c. large because tax changes create significant labor supply changes at both the intensive and the extensive margin d. small because regulations prevent people from entering the labor force
- In which case is the total amount of a payroll tax paid by employees through lower wages? Group of answer choices When the labor supply curve is horizontal. When the labor supply curve is vertical.. When the labor demand curve is vertical. When the labor supply curve is downward sloping at a 45-degree angle. When unemployment is widespread and the wage is above its market clearing level, a cut in employer payroll tax will Group of answer choices drive up wages but have little to no effect on employment and unemployment. increase employment, reduce unemployment, and have little effect on wages. be largely ineffective. benefit employers and have no effect on workers.An economy has two types of jobs, Good and Bad, and two types of workers, Qualified and Unqualified. The population consists of 60% Qualified and 40% Unqualified. In a Bad job, either type of worker produces 10 units of output. In a Good job, a Qualified worker produces 100 units, and an Unqualified worker produces 0. There is enough demand for workers that for each type of job, companies must pay what they expect the appointee to produce. Companies must hire each worker without observing his type and pay him before knowing his actual output. But Qualified workers can signal their qualification by getting educated. For a Qualified worker, the cost of getting educated to level n is n2/2 , whereas for an Unqualified worker, it is n2. These costs are measured in the same units as output, and n must be an integer. Finally, both types of workers need a non-negative payoff in order to accept a job. a) What is the minimum level of n that will achieve separation?which of the following will not result in leftward shift of the market demand curve for labor? decrease in demand for the firm products increase in the wage decrease in the firm decrease in labor productivity
- Related to the theory of equilibrium in the labor market. Describe the impact of the following policies on equilibrium in the labor market in detail (Assumption: Labor supply is elastic): a. Payroll Tax imposed on companies.b. Imposition of Income Tax which is borne by employees.c. Income Subsidy Imposition (Payroll Subsidy)Explain all right as well as wrong options In 1986 Congress drastically cut the marginal tax rate on upper income levels from 50% to 28%. Empirical evidence analyzing the labor supply effects of the tax cut found that women in the high income tax bracket Select one: A. reduced their labor force participation and hours worked significantly because of a dominant income effect. B. increased both labor force participation and hours of work significantly. C. experienced offsetting substitution and income effects. D. did not respond in any significant way to the tax cut, as their high level of income ensured that they were already content with their labor supply choices.Q2 Workers' skills in one industry do not affect the labor market in other industries. True False Q6 According to the segmented labor market theory, firms in competitive markets have no real incentive to eliminate the wage gap once it is established. False True Q8 The competitive labor market determines the equilibrium wage and employment on the basis of market supply and demand. False True Q9 State officeholders have an incentive to placate large public unions if they want to be re-elected. False True
- A more elastic labor supply shows that hours worked is more responsive to changes in tax rates. True or false?The labor supply curve is upward sloping because Question 3 options: workers are willing to work more hours at higher wages. workers will work as many hours as possible no matter the wage. employers will reduce the hours they employ as the wage rises. employers will hire a specific quantity of labor no matter the wage.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.