Suppose in a Small Community Workers Can Find Employment in Two

question 95

Essay

Suppose in a small community workers can find employment in two industries: Clothing and Steel. In the Clothing industry, the marginal product of labor is always 1. In the Steel industry, the marginal product of labor is 12L_S^.5 -2, where L_S is the total number of workers employed in the Steel sector. The total supply of labor in this community is fixed at L_C +L_S =25, and the output price is 1 for both Clothing and Steel. a)Suppose that the labor market is perfectly competitive. How many workers will be employed in the Clothing sector, and how many in the Steel sector? b)What wage rate will workers in each sector receive?

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Definitions:

Frontal Cortex

The part of the brain located in the front of the skull that is responsible for executive functions, such as decision-making, problem-solving, control of purposeful behaviors, consciousness, and emotions.

Decision Making

A cognitive process resulting in the selection of a belief or a course of action among several possible alternatives.

G. Stanley Hall

An American psychologist and educator who is considered one of the founding figures of child psychology and educational psychology.

Storm And Stress

A term referring to the period of adolescence in which teenagers are more prone to emotional turmoil, conflict with parents, and risky behavior, as proposed by G. Stanley Hall.