Bundle: Principles of Microeconomics, Loose-leaf Version, 8th + MindTap Economics, 1 term (6 months) Printed Access Card
8th Edition
ISBN: 9781337379151
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 18, Problem 8PA
Subpart (a):
To determine
The changes in labor market after the introduction of fringe benefits .
Subpart (b):
To determine
The changes in labor market after the introduction of fringe benefits.
Subpart (c):
To determine
The changes in labor market after the introduction of fringe benefits.
Subpart (d):
To determine
The changes in labor market after the introduction of fringe benefits.
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Policymakers sometimes propose laws re3quiring firms to give workers certain fringe benefits, such as health insurance or paid parental leave. Let’s consider the effects of such a policy on the labor market.a.Suppose that a law required firms to give each worker $3 of fringe benefits for every hour that the worker is employed by the firm. How does this law affect the marginal profit that a firm earns from each worker at a given cash wage? How does the law affect the demand curve for labor? Draw your answer on a graph with the cash wage on the vertical axis.
Policymakers sometimes propose laws requiring firms to give workerscertain fringe benefits, such as health insurance or paid parental leave.Let's consider the effects of such a policy on the labor market.a. Suppose that a law required firms to give each worker $3 of fringebenefits for every hour that the worker is employed by the firm. Howdoes this law affect the marginal profit that a firm earns from eachworker at a given cash wage? How does the law affect the demand curvefor labor? Draw your answer on a graph with the cash wage on thevertical axis.
b. If there is no change in labor supply how would this law affectemployment and wages?
c. Why might the labor-supply curve shift in response to this law? Wouldthis shift in labor supply raise or lower the impact of the law on wagesand employment?
d. As discussed in Chapter 6, the wages of some workers, particularly theunskilled and inexperienced, are kept above the equilibrium level byminimum wage laws. What effect would a fringe-benefit…
The table shows levels of employment (Labor), the marginal product of each of those levels, and a monopoly's marginal revenue. What is the monopoly's marginal revenue product at each level of employment? If the monopoly operates in a perfectly competitive labor market where the going market wage is $20, what is the firm's profit maximizing level of employment?
Chapter 18 Solutions
Bundle: Principles of Microeconomics, Loose-leaf Version, 8th + MindTap Economics, 1 term (6 months) Printed Access Card
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