In: Economics

The demand curve for labor facing a monopsonist is given as W=35-6L. The labor supply curve is W=3+L, where W represents the hourly wage and L the number of person hours hired.

a) Write out the formula for the monopsonist's marginal labor cost curve?

b) What is the optimal quantity of labor hired by the monopsonist?

c) Determine the optimal wage paid by the monopsonist.

A monopsonist’ s demand for labor can be written as MRP =
40-0.005E. The firm’s labor supply is given by w = 5+ 0.01E.
Therefore, the firm’s marginal expense of hiring workers when it
hires off of this supply schedule is ME = 5 + 0.02E. (E is for
employment, number of workers).a. Draw a graph that represents the labor market for the firm.
Label all axes and relevant curves.b. How many units of labor does the monopsony firm hire...

A monopsonist faces a labor supply curve given by L s = −400 +
0.01w , where w is the annual salary.
(a) What is the lowest salary the firm can pay yet still induce
one worker to want to work for the firm? What is lowest salary the
firm must pay to induce two workers to work for the firm?
(b) What is the marginal cost to the firm of adding a second
worker given that it must pay...

A
monopsonist has a labor supply curve of =10+L and marginal product
of labor curve of 20-L. If the price is set to 8, what is the wage
the monopsonist has to pay?

Labor Supply in an industry is given by ES = 10 + w and labor
demand is given by ED = 40 − 4w, where E is the level of employment
and w is hourly wage rate.
1) Draw the supply and demand curves and find the competitive
equilibrium wage and employment level.
2) What is the unemployment rate at this equilibrium?
3) Calculate the producer and worker surplus
4) Suppose that the government imposes a minimum wage of $8...

Inverse Labor Supply is w=5L. The Inverse Labor Demand curve is
w=100-20L
Suppose there is a negative production externality that costs
society $50 per unit of labor hired.
1. what is the social marginal benefit curve now, and why is it
not the same as labor demand curve?
2. what is the socially optimal level of employment
3. what is the dead-weight loss associated w/ CME?
4. what is the dead-weight loss associated w/ the monopsony?
5. is the monopsony...

Question 1:
The labor supply curve is given by: ES
= 40w
The labor demand curve is given by: ED = 1800 -
20W
1.a) At what wage W* and employment level E* will the market be
in equilibrium?
1.b) On the graph below, draw the supply curve (label it S), the
demand curve (label it D). Indicate clearly where each curve
intersects the horizontal and vertical axis. On your graph, clearly
indicate where equilibrium price W* and quantity E* are.
Now...

(payroll tax, deadweight loss) Assume the
labor supply curve is given by w=E/2+1 and the labor demand curve
by w=-E/2+4 where E stands for employee-hours (or number of
workers) and w is the wage rate.a) Assume the government assesses a tax of $t on workers for
every employee-hour. Compare the resulting net wage and the total
wage cost with this tax in place to the wage rate in the case where
no tax is assessed. In particular, how is the...

Consider the case where the demand curve and supply curve for
unskilled labor are given in the following table:
(1) Wage Rate (/hour)
(2) Wage Rate2 (/hour) (employer pays tax)
(3) Q of Labour Demanded (hrs/week)
(4) Wage Rate2 (/hour)
(5) Q of Labour Supplied (hrs/week)
8.5
10
1000
1900
8
9.5
1200
1800
7.5
9
1400
1700
7
8.5
1600
1600
6.5
8
1800
1500
6
7.5
2000
1400
5.5
7
2200
1300
Employment insurance premium is paid in...

Suppose a firm has a labor demand curve given by w = 20 - 0.01E.
Furthermore, suppose that the union representing workers in the
firm derives utility from the wage rate and the level of employment
according to the utility function U = w · E where the marginal
utility of an increase in the wage is MUw = E and the marginal
utility of an increase in employment is MUE =w.
(a) Graphically depict the union's utility-maximization problem,
as...

Labor demand: Ld = 210 – 2W
Labor supply: Ls = 120 + W
W = the wage rate.
If the government sets the minimum wage rate at $40 per hour,
Ld or employment will decline by ___ (compare with
equilibrium employment).
Select one:
A. 5
B. 10
C. 15
D. 20
E. 25

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