Use the calculator to help you answer the following questions. You will not be g

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Use the calculator to help you answer the following questions. You will not be graded on any changes you make to the calculator Tool tip: Use your mouse to drag the green line on the graph. The values in the boxes of the calculator will change accordingly. You can also directly change the values in the boxes with the white background by clicking in the box and typing. When you click the Calculate button, the graph and any related values will change accordingly MARKET FOR LABOR WAGE RATE (Dollars per hourl 18 Wage Rate Dollars per hour 15 Labor Demanded Thousands of workers Labor Supplied Thousands of workers 417 183 12 100 200 300 400 500 600 LABOR Thousands of workers] Reset to Initial Values Calculate In this market, the equilibrium hourly wage is workers , and the equilibrium quantity of labor is Suppose a senator introduces a bill to legislate a minimum hourly wage of $12. At a wage of $12 per hour, the quantity of labor firms will demand is workers, whereas the quantity of labor workers will supply is workers. Therefore, there will be of workers in this market. In the pressure on wages until the labor market achieves absence of any price controls, this will exert equilibrium. However, with a price control in place, the labor market may or may not be able to reach its equilibrium (Note: Economists call a minimum wage that prevents the labor market from reaching equilibrium a binding minimum wage.) In this particular case, the minimum wage of $12 per hour reaching the equilibrium you found before and prevent the market from contribute to prolonged unemployment. The minimum wage causes unemployment.

Explanation / Answer

1) Equilibrium wage = $ 9

2) Equilibrium quantity of labor = 300 thousands of worker

3) 250 thousands of worker demanded

4) 350 thousands of worker supplied

5) surplus of (350 - 250) thousands = 100 thousands of workers

6) downward pressure

7) binding wage which

8) provide options for the blank

9) Structural unemployment

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