Consider the labor market for the fast-food industry, which consists mainly of high school and college students. Assume that all fast-food restaurantsare profit maximizing. The following calculator shows the market demand curve (blue curve) and market supply curve (orange curve) for studentworkers, who are responsible for making tacos.At any time in this problem, you can click the Reset to Initial Values button to return the elements in the calculator to their original positions. You willnot be graded on any changes to the calculator; it's just here to help you answer the following questions.Tool tip: You can directly change the values in the boxes with the white background by clicking in the box and typing. The graph and any relatedvalues will change accordingly.WAGE RATEIX0 10 20 30 40 50 60 70 80 90 100QUANTITY OF LABOR (Thousands of workers)14Graph Input ToolLABOR MARKET CALCULATORWage rateLabor demanded(Thousands ofworkers)Price of a taco(Dollars)When the price of a taco is $3, the equilibrium wage in the fast-food labor market is $14303Labor supplied(Thousands ofworkers)per hour.(?)70Suppose that the demand for tacos increases enough so that the price of a taco rises to $6. Ordinarily, this would result in a new equilibriumemployment level and wage in the labor market for young people who work in fast-food restaurants.However, restaurants claim they can only afford to pay the initial equilibrium wage. In this labor market, if the price of tacos increases, but restaurantscontinue to pay the equilibrium wage that prevailed before the increase in demand for tacos, there will be a laborworkers.

*Answer: Answer: When the price of a taco is $3, the equilibrium wage in the fast-food labor…

e for making tacos. you can click the Reset to Initial Values button to return the elements in the calculator to their original positi ges to the calculator, it's just here to help you answer the following questions. sange the values in the boxes with the white background by clicking in the box and typing. The graph and any gly. 1 30 40 50 60 70 80 90 100 OF LABOR (Thousands of workers) Graph Input Tool LABOR MARKET CALCULATOR Wage rate Labor demanded (Thousands of workers) Price of a taco (Dollars) is $3, the equilibrium wage in the fast-food labor market is S 14 30 Labor supplied (Thousands of workers) per hour. ? 70 d for tacos increases enough so that the price of a taco rises to $6. Ordinarily, this would result in a new equilibrium age in the labor market for young people who work in fast-food restaurants. mim they can only afford to pay the initial equilibrium wage. In this labor market, if the price of tacos increases, but resta librium wage that prevailed before the increase in demand for tacos, there will be a labor of arkers.

e for making tacos. you can click the Reset to Initial Values button to return the elements in the calculator to their original positi ges to the calculator, it's just here to help you answer the following questions. sange the values in the boxes with the white background by clicking in the box and typing. The graph and any gly. 1 30 40 50 60 70 80 90 100 OF LABOR (Thousands of workers) Graph Input Tool LABOR MARKET CALCULATOR Wage rate Labor demanded (Thousands of workers) Price of a taco (Dollars) is $3, the equilibrium wage in the fast-food labor market is S 14 30 Labor supplied (Thousands of workers) per hour. ? 70 d for tacos increases enough so that the price of a taco rises to $6. Ordinarily, this would result in a new equilibrium age in the labor market for young people who work in fast-food restaurants. mim they can only afford to pay the initial equilibrium wage. In this labor market, if the price of tacos increases, but resta librium wage that prevailed before the increase in demand for tacos, there will be a labor of arkers.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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