Table 4-7 Table 4-7 Shows the Demand and Supply Schedules

question 255

Multiple Choice

Table 4-7
Table 4-7 shows the demand and supply schedules for the labor market in the city of Pixley.
-Refer to Table 4-7. Suppose that the quantity of labor supplied decreases by 80,000 at each wage level. What are the new free market equilibrium hourly wage and the new equilibrium quantity of labor?

• A) W = $8.50; Q = 550,000
• B) W = $12.50; Q = 550,000
• C) W = $8.50; Q = 630,000
• D) W = $11.50; Q = 610,000

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Definitions:

Business Borrowing

The act of obtaining funds by businesses from external sources like banks or financial institutions to finance operations or investments.

Loanable Funds

The total quantity of funds available for borrowing in the financial markets, determined by savings and the willingness of individuals and institutions to lend.

Interest Rates

The cost of borrowing money or the return for lending money, typically expressed as a percentage of the principal amount per annum.

Loanable Funds

The sum of money available for borrowing in the financial markets, where interest rates adjust to match supply and demand.