As with previous editions, the \"Hot Careers 2014\" report predicts realistic ar

Question

As with previous editions, the "Hot Careers 2014" report predicts realistic areas of employment where recent graduates and and mid-career professionals can leverage or build upon thier skills to enter the workforce. The list is intended as a broad analysis of the best opportunities for those job seekers who have at least an undergraduate degree. Data for the "Hot Careers 2014" designation is based on wage and employment data from the U.S. Bureau of Labor Stattistics'Occupational Employment Stattistics." According to the release, criteria used to compile the list include: "(1) projected growth in the occupation between 2010 and 2020 and (2) median annual salary in the occupation."

a) Write out the conditon that basic theory predicts should hold in equliibrium (i.e. what should the equalibrium wage rate equal). Explain what this means and why it should hold.

Explanation / Answer

a) The condition that basic theory predicts should hold in equilibrium is that the supply of labor equals the demand for labor. This means that the wage rate is determined based on the demand and supply in the labor market. In order for the equilibrium conditions to be met it is a must that the supply and demand of labor are equal so as to ensure that the wage rate is not lower or higher than the wage rate determined at equilibrium level. A shift in demand or supply will affect the equilibrium wage rates depending on the direction of the movement.

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