LABOR ECONOMICS
8th Edition
ISBN: 9781260004724
Author: BORJAS
Publisher: RENT MCG
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Question
Chapter 4, Problem 3P
To determine
Calculate the wage and employment level.
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When supplying labour for universities, academics are aware that they can also use their expert knowledge and skills in non-educational jobs. Let w be the wage in the university sector and Wa be the expected wage an academic could earn in industry in their field.
and labour supply for industrial professionals will
and vertical intercept
A. Suppose the industry wage increases. Labour demand for professors will
B. Let Ls = 4w denote the initial university sector labour supply. The graph of this supply cure has slope
= Ls - 3. The graph of the new labour supply curve has slope
and vertical intercept
C. As a result the equilibrium wage will
D. (Notes upload) Demonstrate why using your graph (you may sketch any representative demand curve).
and the equilibrium number of professors working in this sector will
(Enter '1' for increase, '0' for remain unchanged, '-1' for decrease, '3' for possibly increase or decrease)
Suppose two professors are attracted by…
Please answer the first 3 questions.
Suppose that labour demand and labour supply are represented by the equations:
Demand: LD = 10 - 0.5W
Supply: LS = 0.5W
a. Find the equilibrium wage and employment levels.
b. Graph the curves and indicate the equilibrium on a graph.
c. Suppose hiring is done through a labour union in this market which has limited hiring to 4 workers. What will be the wage in this market?
d. Give one factor which causes labour demand to increase and one factor which causes labour supply to increase.
If equilibrium wage is $10 and current wage is 9$, then we expect to have
more wokers than jobs and thus we should decrease wages
less workers than jobs and thus we should increase wages
more wokers than jobs and thus we should increase wage
less wokers than jobs and thus we should decrease wages
None of the above
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