If individuals are paid the wage at which the supply of labor is equal to the...

If individuals are paid the wage at which the supply of labor is equal to the demand for labor,

A) no unemployment exists, and workers have no incentive to shirk.

B) no unemployment exists, and workers have an incentive to shirk.

C) some unemployment still exists, but workers have no incentive to shirk.

D) some unemployment still exists, but managers can tell whether or not workers are shirking.

Solutions

Expert Solution

Option B.

When the supply of labour is equal to the demand for labour, we can say that the labour market is in equilibrium.

At this point there is no unemployment as both supply and demand for labour are balanced.

But If individuals are paid the wages at this point, the workers will have an incentive to shirk.

This means that their willingness to dedicate more of their time to work decreases.

Rahul Sunny answered 1 year ago

Next > < Previous

Related Solutions

When the wage rate paid to labor is below equilibrium: A) the supply of labor increases....

When the wage rate paid to labor is below equilibrium: A) the supply of labor increases. B) the demand for labor decreases. C) the number of workers seeking jobs exceeds the number of jobs available. D) the number of jobs available exceeds the number of workers seeking jobs.

Suppose the manufacturing labor market, which is nonunionized, is in equilibrium at a wage equal to...

Suppose the manufacturing labor market, which is nonunionized, is in equilibrium at a wage equal to $25. Suppose now that the AFL-CIO (a labor organization) organizes the workers in the manufacturing market and negotiates a wage of $30 per hour. After the workers become unionized, how many workers do manufacturing firms collectively hire? 160 workers 200 workers 240 workers There is not enough information to determine the number of workers. After an employer pays the cost of educating a worker,...

Graph a labor supply curve with an upward-sloping labor supply. Label the vertical axis as “wage...

Graph a labor supply curve with an upward-sloping labor supply. Label the vertical axis as “wage rate” and the horizontal axis with “Quantity of labor” a. Place these two points on the curve: {wage= $10, quantity = 30} and {wage = $12, quantity = 45}. Calculate the labor supply elasticity.Label this curve as “Curve A” b. Now, assume that something has changed the labor supply curve so that now the line has a different slope. On this new curve are...

1.What is the wage when labor demanded is equal to 220?

Provide answers to each of the Objective and Short Answer questions below based on the following information. When providing percentages and values less than 100, round to two decimal points. When providing values of greater than 100, round to the nearest whole unit. When forming a graph or model it is not necessary to provide perfectly proportioned graphs, or one in which the slopes of the curves are accurately represented. It is necessary to accurately present all relevant labels and...

Which of these individuals are in the labor force and which are not?

Which of these individuals are in the labor force and which are not? the CEO of Coca Cola a college student who isn't workin and isn't looking for a job a dishwasher at Denny's who wants a better joba former accountant who now stays at home to watch his childrena person who got laid off from his job last week and has a job interview today a former executive who now is retired and living in FloridaCategoriesNot in the labor force In the labor force

28.)In a competitive labor market, if the supply of labor decreases how will the equilibrium wage...

28.)In a competitive labor market, if the supply of labor decreases how will the equilibrium wage rate and employment change? Wage Rate Employment a.) Increase Increase b.) Increase Decrease c.) Decrease Increase d.) Decrease Decrease e.) No change Decrease 29.)How will a decrease in demand for computer repairs impact the demand and wage rate for skilled computer technicians? Wage Rate Employment a.) Decrease Decrease b.) No change Decrease c.) Increase Decrease d.) Increase Increase e.) No change Increase 30.)Which of...

How might an increase in the minimum wage affect labor supply?

With regard to the demand and supply of labor, explain the concept of the equilibrium wage

1. Consider the labor supply and labor demand functions below, where w is the hourly wage...

1. Consider the labor supply and labor demand functions below, where w is the hourly wage and h is the hours worked per day. Labor supply: w=5+2.5´h Labor demand: w=26-0.5´h Compute the daily profit of the firm assuming that other factors of production are all costless. Show all the steps. Also, draw the labor supply and labor demand lines, and identify the economic profit area. (15 points) What if labor demand is less elastic; e.g., labor demand: w=26-h? Would daily...

3. (a) The income effect of a wage rate increase will labor supply, and the substitution...

3. (a) The income effect of a wage rate increase will labor supply, and the substitution effect of a wage rate increase will labor supply. A. increase B. decrease C. not change Therefore, the total effect of a wage rate increase on labor supply is . A. positive B. negative C. ambiguous (b) Increasing the overtime wage rate is often considered as an effective way to increase employees working time during a relatively short period, such as one week. Explain...

Subjects