Exam 9: Employment and Unemployment

How is the wage to be paid to a worker determined by a profit-maximizing firm? If a marginal worker creates 8 units of a product in a month that is sold for $5 per unit,calculate the maximum wage that should be paid to him.

Excessive dependence on cheap foreign imports can cause a(n)________ in certain sectors of the economy.

Susan,Kevin,and Joshua are three individuals who were previously employed but do not have jobs now.Classify these three individuals according to their type of unemployment: a)Susan lost her job a year ago.Although she would like to have a job,she has given up looking for one as she thinks there are no suitable jobs available for her. b)Kevin was working as a finance teacher,but quit his job a few months back to become a stockbroker.Ever since he quit his job,he has been unable to get a new one,although he is actively looking for one. c)Joshua was employed in a steel mill.He lost his job when the labor union in his mill demanded a hike in wages.

Which of the following statements is true?

What is collective bargaining? How can it result in higher unemployment in a country?

In a perfectly competitive labor market,at the equilibrium wage rate,________.

Which of the following statements is true?

The value of a worker's marginal product ________.

The following table defines some population statistics for two countrries. If a group of students decided to try to find jobs while they are studying,which of the above rates would change at first? Assume that it takes the students a few months to actually find a job.

Scenario: Jim, Pam, Michael, and Angela all worked for a paper company until the company went out of business. Jim was a salesman, Pam was a receptionist, Michael was the manager, and Angela was an accountant. Once the company went out of business, they all had to look for and consider other work opportunities. -Refer to the scenario above.If the paper company went out of business because the paper industry is struggling and becoming out of date,which two people are going to have the easiest time finding a job in another industry?

The following figure shows the labor demand curve, LD₁, and labor supply curve, LS₁, in a market. A month later, the labor demand curve shifts to LD₂. -Refer to the figure above.If there is downward wage rigidity in the market,what will be the wage rate,everything else remaining unchanged?

The following figure shows wage versus labor supply. -Refer to the figure above.Assume that the labor market initially clears at point C.Why might the quantity of labor supplied shift to Q₂?

The following figure shows the labor demand curve, LD₁, and labor supply curve, LS₁, in a market. A month later, the labor demand curve shifts to LD₂. -Refer to the figure above.Determine the initial equilibrium employment and wage rate.

The following figure shows wage versus labor supply. -Refer to the figure above.Assuming that the supply for labor is equal to S₁,the demand for labor is equal to D₂,and the minimum wage is w₂,the quantity of labor supplied is equal to ________,and the quantity of labor demanded is equal to ________.

Any change that affects the entire schedule relating the quantity of labor and the value of the marginal product of labor will ________,assuming all else equal.

The following figure shows the labor demand curve, LD₁, and labor supply curve, LS₁, in a market. A month later, the labor demand curve shifts to LD₂. -Refer to the figure above.If there is downward wage rigidity in the market,what will be the unemployment in the market after the demand curve shifts to LD₂?

Which of the following is likely to shift the demand curve for carpenters rightward,assuming all else equal?

What causes the labor demand curve to shift? List three factors that can cause the labor demand curve to shift right.

Scenario: Suppose an economy consists of only the following economic agents: 2 million full-time workers, 1 million part-time workers, 1 million people who have been laid off by their employers but are currently looking for employment, 1 million children aged 15 years or younger, and 2 million housewives not looking for jobs. -Refer to the scenario above.What is the size of the labor force in the economy?

The following figure shows the labor demand curve, LD₁, and labor supply curve, LS₁, in a market. -Refer to the figure above.Calculate the equilibrium wage rate and the equilibrium level of employment.