TF_Q2_answerkey - E V 3 From the dynamic labour supply...

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Unformatted text preview: E V 3. From the dynamic labour supply model, a fully anticipated rise in wages creates a (7/ small labour supply response because it generates a large income effect. ( / ‘ \5 m5 Mm A 1;\..£,w£ \- Rn} aixgifi if?” itiw 3 as! W CNM' {2; 52C?“ , (”U ~ E 4. An increase in the standard workweek from 35 hours to 40 hours per week will increase workers’ labour supply. (Graph strongly suggested) ' b} ... J“ a J _ . ~Yr «5/ r, ,/ ,jfli‘tjx- gr» ’ . " v E 1 [‘0 Q“) . : i (y 6;?“ 3) LQ' 6") 5 . Union A wants to represent workers in a firm that would hire 20,000 workers if the wage rate is $12 t; 5 and would hire 10,000 workers if the wage rate is $15. Union B wants to represent workers in a firm that r .0 \“L/f/ would hire 30,000 workers if the wage is $20 and would hire 33,000 workers if the wage is $15. Union B is 0:7; ‘7’“ 4 more likely to organize. W I, ,Dx-l’ f 13m l I / , 1.2, bit; M W :3. L0 ivzt‘zm {M a 243‘“ 59‘; 1.. i ii is x iii Q)?" . ,0, ' . a f (/2- t _ '3 0,, \ i J i < .‘J .4 5 ~— ’ v: mam“ J, 0/ g , ,L/r 0/? a ’ ‘50 i) *1: ‘ b “to ‘g . D 2. 4 ‘ n " whom» m \ gig/wit (”xix J W C) x © Di), 3:;- w‘ _ r 9 M ‘1 Z _, @ Dmgi E ii? wait-U Qua, Jim fird‘i‘rmflg fith‘” $3.17“? §£i_ “is: Z; fA‘fimfi‘i’g Q E’kymfifk W gig £553 ah 1i“; m) f \ {23 H ”g aura :3; 1/. 6. Suppose the supply curve for night guards is Ls=20, and the demand curve for night guards is Ld=100~20W, where L is the number of night guards and W=the hourly wage. Suppose the government imposes a tax of 1$ per hour per worker on companies hiring night guards. Night guards will experience a wage decrease by less than a dollar. (Graph strongly suggested) You can use the reverse of this page to answer both parts of the question. Please, answer as completely as possible. Question 2 (10 points) Briefly explain how the following programs would affect the elasticity of demand for labour in the steel industry: a) an increased tariff on steel imports kinda Dina/9‘3, {£0wa iiififinémeg fit: Wad/Lag {3f 9 fez/Q Width“; ii" fiesta; Vifmetiamim I it. a A \‘ww. at . Ad! :1 A , g s ,, :3 Aw A}: A‘ ., WSW“ fit}? W am , fig“ {fins in. r; a; imam % wk, $th ;A obi, {NA W in mm M labs 5 b) A law making it illegal to lay—off workers for economic reasons a“? WW; «mm *3: "w M (Mr m m: c) A boom in the machinery industry (which uses steel as an input) causing production in that industry to rise yucca» ,‘ \ u. 9 -, b t: fr» 41 {a}? (1 CA {LA 9 {if} {Mffiflm Ag? g6";- fiixflfifif d) An increase in the wages paid by employers in the steel industry V“ (MU udmm figwwM At 3 A . ., ’3‘ E: 3%: g E" “fay Law W m w a; mfl 5 m w\ ‘ , x I! Ly AV. N 36% 22):} M.. (AAA, WM? » M \ hr» “Ark! r é: (Sig) fifidwflf iii? 4:“) (Mr j w La we M g- MM ...
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