Homework Help is Here – Start Your Trial Now!
Business
Economics
RATE 4. Excess supply with union wages Consider the housing construction industry. Assume that the industry is perfectly competitive in both input and output markets. Suppose that, through collective bargaining, a labor union negotiates an industry-wide wage for various kinds of labor (electricians, plumbers, and so on). In particular, it succeeds in negotiating a wage increase for carpenters from $30 to $40 per hour. The following graph shows the labor demand of an individual firm. On the following graph, show what happens at the firm level as a result of the union negotiations. 10 20 50 24 72 QUANTITY OF LABOR Demand 120 Demand Supply Supply Now consider the effects of the wage change on the entire industry. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. WAGE RATE (Dollars per hour) Supply Graph Input Tool Wage Rate 30 (Dollars per hour) Quantity 72 Demanded Quantity Supplied (Thousands of 72 (Thousands of workers) workers) Excess Supply 0 Shortage 0 (Thousands of workers) (Thousands of workers) Demand Demand Shifter Pro-union Advertising (Millions of dollars) 0 144 24 48 72 96 120 QUANTITY OF LABOR (Thousands of workers) The union's wage increase from $30 to $40 per hour causes an excess supply of thousands of workers.) workers. (Note: Be sure to enter your answer in Suppose that the union, in order to mitigate the unemployment caused by the wage increase, bolsters demand by rolling out a "Buy Union" advertising campaign. If the union spends $10 million on the campaign, the excess supply of labor will be answer in thousands of workers.) workers. (Note: Be sure to enter your

RATE 4. Excess supply with union wages Consider the housing construction industry. Assume that the industry is perfectly competitive in both input and output markets. Suppose that, through collective bargaining, a labor union negotiates an industry-wide wage for various kinds of labor (electricians, plumbers, and so on). In particular, it succeeds in negotiating a wage increase for carpenters from $30 to $40 per hour. The following graph shows the labor demand of an individual firm. On the following graph, show what happens at the firm level as a result of the union negotiations. 10 20 50 24 72 QUANTITY OF LABOR Demand 120 Demand Supply Supply Now consider the effects of the wage change on the entire industry. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. WAGE RATE (Dollars per hour) Supply Graph Input Tool Wage Rate 30 (Dollars per hour) Quantity 72 Demanded Quantity Supplied (Thousands of 72 (Thousands of workers) workers) Excess Supply 0 Shortage 0 (Thousands of workers) (Thousands of workers) Demand Demand Shifter Pro-union Advertising (Millions of dollars) 0 144 24 48 72 96 120 QUANTITY OF LABOR (Thousands of workers) The union's wage increase from $30 to $40 per hour causes an excess supply of thousands of workers.) workers. (Note: Be sure to enter your answer in Suppose that the union, in order to mitigate the unemployment caused by the wage increase, bolsters demand by rolling out a "Buy Union" advertising campaign. If the union spends $10 million on the campaign, the excess supply of labor will be answer in thousands of workers.) workers. (Note: Be sure to enter your

Principles of Microeconomics (MindTap Course List)
Principles of Microeconomics (MindTap Course List)
8th Edition
ISBN:9781305971493
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter18: The Markets For The Factor Of Production
Section: Chapter Questions
Problem 3PA
See similar textbooks
icon
Related questions
Question
RATE 4. Excess supply with union wages Consider the housing construction industry. Assume that the industry is perfectly competitive in both input and output markets. Suppose that, through collective bargaining, a labor union negotiates an industry-wide wage for various kinds of labor (electricians, plumbers, and so on). In particular, it succeeds in negotiating a wage increase for carpenters from $30 to $40 per hour. The following graph shows the labor demand of an individual firm. On the following graph, show what happens at the firm level as a result of the union negotiations. 10 20 50 24 72 QUANTITY OF LABOR Demand 120 Demand Supply Supply Now consider the effects of the wage change on the entire industry. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. WAGE RATE (Dollars per hour) Supply Graph Input Tool Wage Rate 30 (Dollars per hour) Quantity 72 Demanded Quantity Supplied (Thousands of 72 (Thousands of workers) workers) Excess Supply 0 Shortage 0 (Thousands of workers) (Thousands of workers) Demand Demand Shifter Pro-union Advertising (Millions of dollars) 0 144 24 48 72 96 120 QUANTITY OF LABOR (Thousands of workers) The union's wage increase from $30 to $40 per hour causes an excess supply of thousands of workers.) workers. (Note: Be sure to enter your answer in Suppose that the union, in order to mitigate the unemployment caused by the wage increase, bolsters demand by rolling out a "Buy Union" advertising campaign. If the union spends $10 million on the campaign, the excess supply of labor will be answer in thousands of workers.) workers. (Note: Be sure to enter your
Transcribed Image Text:RATE 4. Excess supply with union wages Consider the housing construction industry. Assume that the industry is perfectly competitive in both input and output markets. Suppose that, through collective bargaining, a labor union negotiates an industry-wide wage for various kinds of labor (electricians, plumbers, and so on). In particular, it succeeds in negotiating a wage increase for carpenters from $30 to $40 per hour. The following graph shows the labor demand of an individual firm. On the following graph, show what happens at the firm level as a result of the union negotiations. 10 20 50 24 72 QUANTITY OF LABOR Demand 120 Demand Supply Supply Now consider the effects of the wage change on the entire industry. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. WAGE RATE (Dollars per hour) Supply Graph Input Tool Wage Rate 30 (Dollars per hour) Quantity 72 Demanded Quantity Supplied (Thousands of 72 (Thousands of workers) workers) Excess Supply 0 Shortage 0 (Thousands of workers) (Thousands of workers) Demand Demand Shifter Pro-union Advertising (Millions of dollars) 0 144 24 48 72 96 120 QUANTITY OF LABOR (Thousands of workers) The union's wage increase from $30 to $40 per hour causes an excess supply of thousands of workers.) workers. (Note: Be sure to enter your answer in Suppose that the union, in order to mitigate the unemployment caused by the wage increase, bolsters demand by rolling out a "Buy Union" advertising campaign. If the union spends $10 million on the campaign, the excess supply of labor will be answer in thousands of workers.) workers. (Note: Be sure to enter your
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 1 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Similar questions
Recommended textbooks for you
Principles of Microeconomics (MindTap Course List)
Principles of Microeconomics (MindTap Course List)
Economics
ISBN:
9781305971493
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Microeconomic Theory
Microeconomic Theory
Economics
ISBN:
9781337517942
Author:
NICHOLSON
Publisher:
Cengage
Principles of Microeconomics
Principles of Microeconomics
Economics
ISBN:
9781305156050
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics 2e
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax
Microeconomics: Principles & Policy
Microeconomics: Principles & Policy
Economics
ISBN:
9781337794992
Author:
William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:
Cengage Learning
ECON MICRO
ECON MICRO
Economics
ISBN:
9781337000536
Author:
William A. McEachern
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS