How would the following factors affect equilibrium in the market for labor?
a. An increase in the demand for the product that a firm is producing
b. The use of a new technology that halves the time that workers will take to produce a good
c. An increase in the age when people begin to receive Social Security benefits.
a. Since the demand for labor is derived from the demand for the final product that labor produces, the demand for labor will increase. Other things remaining unchanged, the demand curve will shift to the right and employment and the wage rate will increase.
b. This is an example of a labor-complementary technology. Since it increases workers' productivity, the labor demand curve will shift to the right. Other things remaining unchanged, employment and the wage rate will increase.
c. Increasing the Social Security age will increase the supply of labor as some people who would have dropped out of the labor force will now continue to work. This will shift the labor supply curve to the right. Other things remaining unchanged, the wage rate will fall and employment will increase.
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The figure above shows that as a result of the tariff, the quantity of T-shirts produced in the United States ________, and the quantity of T-shirts imported ________
A) increases by 15 million per year; decreases by 30 million per year B) increases by 15 million per year; increases by 15 million per year C) decreases by 15 million per year; decreases by 30 million per year D) decreases by 30 million per year; increases by 30 million per year E) does not change; decreases by 15 million per year
According to Figure 2.5, the United States civilian employment ratio in June 2013 was ________
A) 66.7% B) 43.8% C) 59% D) 64.0% E) none of the above