Macroeconomics (Fourth Edition)
4th Edition
ISBN: 9780393603767
Author: Charles I. Jones
Publisher: W. W. Norton & Company
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Question
Chapter 4, Problem 8E
(a)
To determine
Derive the FRED figure.
(b)
To determine
Determine the value of labor share.
(c)
To determine
Explain the production function.
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Can someone show a graph for the 1 question and briefly explain what would happen to the production of Vulcan and tacos.
The following graph shows the labor market in the fast-food industry in the fictional town of Supersize City.
Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph.
Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly.
Graph Input Tool
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Market for Labor in the Fast Food Industry
20
I Wage
(Dollars per hour)
18
Supply
18
Labor Demanded
(Thousands of
workers)
Labor Supplied
(Thousands of
workers)
900
378
14
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2
90
180 270 380 450 540 630 720 810 900
LABOR (Thousands of workers)
In this market, the eqilibrium hourly wage is S
and the equilibrium quantity of labor is
thousand workers.
Suppose a senator introduces a bill to legislate a minimum hourly wage of $6. This type of price control is called a
WAGE (Dollars per hour)
Can you provide an explanation of the graph.
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