The Tables Above Show a Nation's Labor Demand and Labor

question 43

Multiple Choice

$\begin{array}{l}\begin{array} { c c c } \hline & \begin{array} { c } \text { Quantity of labor } \\\text { demanded }\end{array} & \begin{array} { c } \text { Quantity of labor } \\\text { supplied }\end{array} \\\begin{array} { c } \text { Real wage rate } \\\text { (2005 dollars) }\end{array} & \begin{array} { c } \text { billions of hours } \\\text { per year) }\end{array} & \begin{array} { c } \text { (billions of hours } \\\text { per year) }\end{array} \\\hline 50 & 80 & 100 \\40 & 90 & 90 \\30 & 100 & 80 \\20 & 110 & 70 \\10 & 120 & 60 \\\hline\end{array}&\begin{array} { c c } \hline \begin{array} { c } \text { Employment } \\\text { (billions } \\\text { of hours } \\\text { per year) }\end{array} & \begin{array} { c } \text { Real GDP } \\\text { (billions of } \\\text { 2005 dollars) }\end{array} \\\hline 60 & 2.0 \\70 & 3.0 \\80 & 3.7 \\90 & 4.2 \\110 & 4.5 \\\hline\end{array}\end{array}$ The tables above show a nation's labor demand and labor supply schedules and its production function.
- Given the equilibrium in the labor market, potential GDP is

• A)$4.5 trillion.
• B)$2.0 trillion.
• C)$3.7 trillion.
• D)$3.0 trillion.
• E)$4.2 trillion.

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Definitions:

Customers

People or organizations that buy products or services from a company.

Rate

A measure of the speed at which something happens or is processed, often expressed as a unit per time.

Minute

A unit of time equal to 60 seconds or 1/60th of an hour, commonly used to measure the duration of time.

Discrete Variables

Variables in statistical analysis that assume distinct or separate values, often counted in whole numbers.