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Unformatted text preview: (iii) Suppose now that a consortium of hospitals becomes the only employer of nurses in the capital region ( i.e. all the demand for nurses comes from a single employer). Would the nurses be better or worse o/ than in the competitive equilibrium? (I do not need the exact number but explain your answer.) 1 (3) Suppose employers prefer high-school graduates to drop-outs. Explain with a diagram and in words how an increase in the minimum wage can cause the graduates to crowd-out ( i.e. displace) the drop-outs in employment. How do you think this result &ts in with the original intension of the minimum wage legislation? What might be the long-term implications for the high school graduation rate? 2...
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- Spring '08
- Supply And Demand, minimum wage legislation, competitive equilibrium wage, short-run labor demand