The Figure Given Below Represents Equilibrium in the Labor Market

question 16

Multiple Choice

The figure given below represents equilibrium in the labor market with the demand and supply curves of labor. Figure 14.6 In the figure,
D = MRP implies demand for labor = Marginal Revenue Product
MFC represents Marginal Factor Cost curve
S represents the supply curve of labor
According to Figure 14.6, what is the wage and quantity of labor hired by a competitive firm?

• A)$12 and 75 laborers
• B)$20 and 75 laborers
• C)$15 and 125 laborers
• D)$10 and 250 laborers
• E)$23 and 50 laborers

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Definitions:

Seller Bears

Refers to situations where the seller is responsible for any additional costs or risks associated with a transaction.

FICA Tax

A U.S. federal payroll tax that funds Social Security and Medicare, contributions are made by both employees and employers.

Burden Falls

An economic term referring to how the costs or economic burdens of a policy, tax, or regulation are distributed among various stakeholders.

Elastic

Elastic, in economics, refers to a situation where the quantity demanded or supplied of a good or service significantly changes in response to changes in price.