Use the information in the table below to calculate the value of the marginal product of labor (VMPĻ) for each level of employment in this perfectly competitive market and plot the labor demand curve. # of Workers (L) 1| 2 3 4 MPL 24 22 20 18 Price of Output (P) $5 $5 $5 $5 Provide your answer below: 130 120- 110 100 90 80 -70 60 50 2 workers (2,40) 4 workers (4,40) -40 1 worker (1,40) 3 workers (3,40) Labor Demand Cabor (L). Value of Marginal Product of Labor

Look at the graph below. Labor demand falls from D0 to D1 due to an economic recession. What is the resulting wage in the short-run due to this shift in demand? HINT: Consider whether this is a situation in which the wages are sticky or flexible. Wage Rate 40 35 30 25 20 15 10 5 0 5 10 15 20 25 30 Quantity of Labor D1 35 40 DO

Read the "Clear it Up: Do Profit Maximizing Employers Exploit Labor" Do Profit Maximizing Employers Exploit Labor? (Source: OER)  If you look back at the labor dynamics of supply and demand, you will see that only the firm pays the last worker it hires what they’re worth to the firm. Every other worker brings in more revenue than the firm pays him or her. This has sometimes led to the claim that employers exploit workers because they do not pay workers what they are worth. Let’s think about this claim. The first worker is worth $x to the firm, and the second worker is worth $y, but why are they worth that much? It is because of the capital and technology with which they work. The difference between workers’ worth and their compensation goes to pay for the capital, technology, without which the workers wouldn’t have a job. The difference also goes to the employer’s profit, without which the firm would close and workers wouldn’t have a job. The firm may be earning excessive profits,…

In Houston, 180 people are willing to work an hour as hostesses if the wage is $10 per hour. For each additional $5 that the wage rises above $10, an additional 45 people are willing to work an hour. For wages of $10, $15, $20, $25, and $30 per hour, plot the daily labor supply curve for hostesses on the following graph. WAGE (Dollars per hour) 50 45 40 35 30 20 15 10 5 0 77°F Mostly sunny 0 45 90 315 225 270 135 180 LABOR (Number of workers) 360 405 450 -- Supply C O