In the short-run specific-factors model, consider a decrease in the stock of land. For example, suppose a natural disaster decreases the quantity of arable land used for planting crops. a. Demonstrate a change in the supply of land on the accompanying diagram. b. New equilibrium wage:

B and c please

● Suppose government mandates required firms to make 'safety expenditures' on behalf of workers that did not improve labor productivity. Describe the scale and substitution effects these mandates would have in the labor market.

Assume a firm is trying to maximize output subject to a budget and is currently in the long run equilibrium shown below. Make changes to the graph to show the impact of a decrease in the wage. Make sure that the graph shows the new output-maximizing combination as well as the new levels labor and capital.

1. Consider a static labour supply model for an individual. Assume that the person works a positive number of hours. Assume that the utility function is of the following form: U=x0.5 +8(T-h)(0.5) where x is consumption and his hours of work, and 8 is a parameter of the utility function. The person is paid a wage of w for each hour worked. The person has no other source of income other than employment earnings. Assume that the price of x equals 1. a) Specify the utility maximization problem, write down the Lagrange function, and solve for the first order conditions. b) Solve for the MRS condition between consumption and hours of work. c) Assume that 8=2 if the person has a child living at home, and 8=1 otherwise. Explain (and either show mathematically or graphically) how this will affect the optimal number of hours of work of the person.

What do economists mean by "deminishing returns" to an input? What causes diminishing returns? Where would one observe this principle at a job and the real world?

38) In the short run, the marginal product of labor might increase initially as more workers are hired because A) the first workers hired get to use the best equipment. B) specialization allows a worker to focus on one task, thereby increasing her proficiency at that task. c the best workers are hired first and later hires are not as skillful. Dj beyond some point, a firm has hired too many workers.

= $30 and wage rate Let the production function be given by: q = 10(L^2)K, with rental rate v W = $20. 1. How much K and L are employed to produce 11,250 units of output? 2. Suppose that the firm wants to increase output to 19, 440 units of output, now how much K and Lare employed to produce with minimize cost? 3. Suppose that in the short run the amount of capital is fixed at K = 10, what is the firm short run fixed cost? 4. Suppose that in the short run the amount of capital is fixed at K = 10, what is the short run total cost of producing 900 units of output?

Consider the labor–leisure budget constraint curve on the graph. This curve shows trade‑offs between income and leisure that must be made over the course of one week. Assume there are no artificial barriers to limits on hours worked and that the wage is $25 per hour.   Determine the vertical and horizontal intercepts. vertical intercept: $     horizontal intercept:   h

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