ECON MICRO
5th Edition
ISBN: 9781337000536
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 12, Problem 2.4P
To determine
Explain the reason for a permanent wage difference between the market for labour or within the same labour market.
Concept Introduction:
Market for labour: This is a place where employers and employees interact with each other. This refers to the supply and demand for labour where the employers demand and the employees provide the supply.
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1.what is the Working time and wage-effort bargain .
1. The next two questions are about the labor market for upholsterers, who are people who do custom upholstery (the fabric on furniture). A new type of pre-sewn fabric piece reduces the amount of work that an upholsterer needs to do on each piece of furniture, increasing how much work each individual upholsterer can do for the same amount of effort.
This is describing a change in some part of the labor demand or labor supply curves. Which part?
a. Group of answer choices
b. Price of the good (P)
c. Marginal productivity of labor (MPL)
d. The labor/leisure tradeoff in the supply curve
e. The minimum wage
2. Assume that the new pre-sewn fabric ends up making the wage of upholsterers go up.
You also observe that very few tailors, which is a similarly difficult job, decide to switch from being tailors to being upholsterers in response to the wage increase. What is this most likely an example of?
a. Group of answer choices
b. Taste-based discrimination
c. Compensating…
5.
For this question, do not just provide a list of the actors in the labor market.
Describe each actor in the market (i.e. what assumptions are made about them; what side of the
market do they give us; relationship between employment and wages, etc.).
labor economics chapter 1
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- 1. Describe how the wage rate and level of employment are determined if the labor market is purely competitivearrow_forward6 - : What is the production gap? a) Optimal employment B) underemployment NS) full employment D) Overemployment TO) rare employmentarrow_forward2. The Australian Bureau of Statistics (ABS) reported in May 2017 that the civilian population in Australia over 15 years of age was 20.8 million.Of this population of 20.8 million Australians, 13.5 million were employed and0.7 million were unemployed.Calculate Australia’s labor force and the number of people in the civilianpopulation who were not in the labor force? Also, with examples examine thecauses of structural unemployment in Australiaarrow_forward
- 2. The following table provides local and national employment figures for three business sectors. Calculate the location quotients for the auto industry, health care, legal services and identify it as a basic (exporting) or non basic (service) industry. Remember this method requires you to compare the % of total employees in a particular industry in the local economy to the % of employees in that industry nationwide. If the local has a higher % (greater than 1), then it is considered a favorable or exporting industry. For example, for health care locally has 8.33% (25,000/300,000) of the local workforce, while nationally only 1.6% (1,400,000/120,000,000) works in health care. The LQ would be 8.33/1.16 or 7.15 which is greater than 1 and means health care is an exporting (basic) industry. Table for Economic Base, Location Quotients Industry Local City Employment National (USA) Employment % local %…arrow_forwardHow does an increase in the minimum wage affect the economy. Period Minimum Wage Rate Unemployment Rate Inflation Rate Economic Growth Labour Force Participation 2019 - 2020 $17.50 2.8% 0.5% 2.8% 59.8% 2014 – 2018 $15.00 2.71% 3.5% 2.71% 62.6% 2010 - 2013 $12.50 2.21% 2.1% 2.21% 61.7%arrow_forward12-2 Describe why some workers earn higher wages than other workers4. (Why Wages Differ) Why might permanent wage differ- ences occur between different markets for labor or within the same labor market?arrow_forward
- 7 - : What is it called when the economy is deprived of the production and the gain of this factor if the labor is not employed? a) Ta employment B) Increase in crimes NS) Direct product and revenue loss D) loss of human capital TO) natural unemploymentarrow_forwardA dozen eggs costs $o.88 in January 1980 and 2.11 in January 2015. The average wage for production workers was $7.58per hour in January 1980 and $19.64 in January 2015 By what percentage did the price of eggs rise? By what percentage did the wage rise? In each year, how many minutes did a worker have to work to earn enough to buy a dozen eggs? Did workers’ purchasing power in terms of eggs rise or fall?arrow_forwardBeginning in the 1970s and continuing for three decades, women entered the U.S. labor force in a big way. If we assume that wages are sticky in a downward direction, but that around 1970 the demand for labor equaled the supply of labor at the current wage rate, what do you imagine happened to the wage rate, employment, and unemployment as a result of increased labor force participation?arrow_forward
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