The first table above gives the labor demand and labor supply schedules for a nation. The second table gives its production function
a. What are the equilibrium real wage rate and the level of employment?
b. What is potential GDP?
a. The equilibrium real wage rate is $15 an hour because this is the real wage rate for which the quantity of labor demanded equals the quantity supplied. The equilibrium level of employment is 3 billion hours a year.
b. With employment equal to 3 billion hours per year, potential GDP is equal to $60 billion.
Economics
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Economics
Which of the following can always be used to determine the outcome when there are multiple Nash equilibria?
A) the Pareto Criterion B) cheap talk C) Both A and B D) None of the above.
Economics