Demand and Supply of Labour Are Given By

question 77

Essay

Demand and supply of labour are given by:
LD = 250 - 4w
LS = 50 + w
where w is the real wage and LD and LS are the quantities of labour demanded and labour supplied,respectively.
a. What are the equilibrium wage and quantity of employment?
b. If the government imposed a minimum wage of $45,what would be the new quantities of labour and demanded and supplied?
c. How many people would lose their jobs because of the minimum wage,and how many people are now unemployed?
d. Draw a graph to show your results of parts (a),(b),and (c).

---

Definitions:

Solvency

A company's ability to meet its long-term debts and financial obligations.

Liquidity

The ease with which an asset can be converted into cash without affecting its market price.

Net Income

The net income of a company once all costs and taxes are subtracted from its total revenues.

Solvency Measure

Financial metrics used to assess a company's ability to meet its long-term obligations and its financial stability.