Chapter 4, Problem 29P

Predict how each of the following events will raise or lower the equilibrium wage and quantity of oil worker in Texas. In each case, sketch a demand and supply diagram to illustrate your answer.

1. The price of oil rises.
2. New all-drilling equipment is invented that is cheap and requires few workers to run.
3. Several major companies that do not drill oil open factories in Texas, offering many well-paid jobs outside the oil industry.
4. Government imposes costly new regulations to make oil-drilling a safer job.