Answered: part one: Suppose the demand for labor…

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter11: Resource Markets

Section: Chapter Questions

Problem 9PAE

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part one: Suppose the demand for labor is given by W = 25 – 0.2L and the supply is given by W = 10+ 0.3L. What is the equilibrium wage rate?

a.$20.2

b.$19

c.$19.4

d.$19.8

part two:

Suppose the demand for labor is given by W = 250 – 0.05L, and the number of workers available is L = 3,000. What is the equilibrium wage rate?

a.$110

b.$100

c.$130

d.$120

part three:

Suppose the demand for labor is given by W = 250 – 0.05L, and the number of workers available is L = 3,000, and the labor union wants to set a minimum wage of $140. What is the number of workers unemployed?

(Hint: Unemployed workers are the excess supply of labor.)

a.800

b.1,000

c.600

d.400

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