CONTEMPORARY LABOR ECONOMICS (LOOSE)
11th Edition
ISBN: 9781259751950
Author: McConnell
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 1, Problem 4QS
To determine
Application of the concept of demand and supply in labor market.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
In a market economy, one of the following answers would not affect labor supply. Which one?
Group of answer choices
government subsidies for medical students
immigration laws
high birth rates
an increase in wage in a particular labor market
Suppose that the market for labor is initially in equilibrium. An increase in the price of output will cause the equilibrium wage
a. and the equilibrium quantity of labor to fall. b. and the equilibrium quantity of labor to rise. c. to rise and the equilibrium quantity of labor to fall. d. to fall and the equilibrium quantity of labor to rise.
If soccer becomes more popular in the United States and basketball becomes less popular, is it true that professional basketball players will earn more than they earn today? Use the laws of demand and supply in factor markets to explain you answer.
Chapter 1 Solutions
CONTEMPORARY LABOR ECONOMICS (LOOSE)
Knowledge Booster
Similar questions
- Which of the diagrams illustrates the effect of an increase in automobile worker wages on the market for automobiles?arrow_forwardIf capital can only be used to produce shoes, land can only be used to produce beans, and labor is allocated to its most productive use, then in equilibrium A. Shoe wages > Bean wages B. Shoe wages < Bean wages C. Shoe wages = Bean wagesarrow_forwardThe following graph shows the labor market in the fast-food industry in the fictional town of Supersize City. In a labor market, workers supply their labor to the market in exchange for wages, and their behavior is represented by the supply curve. Similarly, firms pay wages to obtain labor, and thus their behavior is represented by the demand curve. In this way, wages are the price of labor. (a). In this market, the equilibrium hourly wage is $_______ and the equilibrium quantity of labor is _______ thousand workers. (b). Suppose a senator introduces a bill to legislate a minimum hourly wage of $8. This type of price control is called a _______ (options: price ceiling, quota, tax, price floor).arrow_forward
- In a market economy, the compensation of labour is determined by the interaction of demand and supply in each labour market, relative compensation by the interaction of relative demand and supply. A higher price for labour leads to a higher quantity of labour supplied, a lower price leads to a lower quantity supplied and prices and wages help coordinate economic activities. Do you agree this statement if so Why?arrow_forwardIn a __________ marriage, both husband and wife are in the labor market.arrow_forwardIn a labor market, supply is composed of which of the following groups? a. Households b. Firms c. Government d. Animal Assume the following: price ceiling < equilibrium price Which term corresponds to the inequality above? a. surplus b. insufficient funds c. shortage d. utopia Assume that there is a shortage in a market that is not eliminated through the price mechanism. What will happen to this shortage in the long run? a. It will become smaller b. It will remain constant size c. It will become larger d. It will disappear because the market will cease to exist Assume that there is a shortage in a market that is not eliminated through the price mechanism, instead, people decide how the shortage is addressed. The outcome is likely to be a. unfair, but efficient b. fair, but inefficient c. fair and efficient d.…arrow_forward
- The following graph shows the labor market in the fast-food industry in the fictional town of Supersize City. In a labor market, workers supply their labor to the market in exchange for wages, and their behavior is represented by the supply curve. Similarly, firms pay wages to obtain labor, and thus their behavior is represented by the demand curve. In this way, wages are the price of labor. For each of the wages listed in the following table, determine the quantity of labor demanded, the quantity of labor supplied, and the direction of pressure exerted on wages in the absence of any price controls. True or False: A minimum wage below $10 per hour is a binding minimum wage in this market. (Hint: Economists call a minimum wage that prevents the labor market from reaching equilibrium a binding minimum wage.)arrow_forwardThe following graph shows the labor market in the fast-food industry in the fictional town of Supersize City. In a labor market, workers supply their labor to the market in exchange for wages, and their behavior is represented by the supply curve. Similarly, firms pay wages to obtain labor, and thus their behavior is represented by the demand curve. In this way, wages are the price of labor. For each of the wages listed in the following table, determine the quantity of labor demanded, the quantity of labor supplied, and the direction of pressure exerted on wages (upward or downward) in the absence of any price controls. Wages: 12 Wages: 8arrow_forwardIf a market price of a factor production is lower than equilibrium price, how can be this situation characterized?arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
Exploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, Inc
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc