With the aid of diagrams, explain why employer discrimination reduces firms’ producer surplus. Explain why this implies that increased competition in product markets shall decrease discrimination in labor markets.
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Q 2. With the aid of diagrams, explain why employer discrimination reduces firms’
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- 10 4. Assume that we are analyzing employer-based discrimination and that there are two groups of workers, group A and group B. These workers are perfect substitutes. The firm's production function is given by q = 20√√EA + EB. This production function implies that the marginal product of labor equals MP = The wage for group workers is $20, the wage for group A workers is $25, and the price of output equals $100. a. If this firm were non-discriminatory, then how many workers would the firm hire and what would profits equal? B √EA+EB b. If the employer discriminated against workers from group B and had a discrimination coefficient equal to 0.85, then how many workers would the firm hire and what would profits equal? c. Given the discrimination coefficient in part (b), what do you expect to happen to this firm in the long-run and why?2) Does a gap between the average earnings of men and women, or between whites and blacks, prove that employers are discriminating in the labor market?On the following graph, use the green line (triangle symbol) to show the effect this employer mandate has on the demand for labor. (?) 20 Demand Supply New Demand New Supply + Equilibrium Before Law Equilibrium After Law A 0 10 Quantity of Labor (Thousands) Topic 6 Homework (Custom) Suppose employees place a value on this benefit exactly equal to its cost. On the preceding graph, use the purple line (diamond symbol) to show the effect this employer mandate has on the supply of labor. Suppose the wage is free to balance supply and demand. Use the black point (plus symbol) to indicate the equilibrium wage and level of employment before this law, and use the grey point (star symbol) to indicate the equilibrium wage and level of employment after this law is implemented. True or False: Employers are made worse off but employees are made better off by this law. True False Suppose that, before the mandate, the wage in this market was $3 above the minimum wage. per hour, which will lead to in…
- 1. Why is a firm's demand for labor considered a 'derived demand?' What is it derived from? 2. The marginal cost of labor (MCL) is equal to what for a firm that operates in a competitive labor market? How does this compare with the MCL for a monopsony.Refer to the following diagram that shows the labor demand for a monopolistic firm hiring labor from a competitive labor market. Wage W₂ W₁ 2. A 1. B MRP с Q₁ Q₂ The allocatively efficient level of employment for this firm is given by some amount greater than Q 2. some amount between Q 1 and Q 2. S VMP LaborThe table shows levels of employment (Labor), the marginal product of each of those levels, and a monopoly's marginal revenue. What is the monopoly's marginal revenue product at each level of employment? If the monopoly operates in a perfectly competitive labor market where the going market wage is $20, what is the firm's profit maximizing level of employment?
- 8. Ch. 20 Problems and Applications Q10 Suppose that Congress passes a law requiring employers to provide employees some benefit (such as healthcare) that raises the cost of an employee by $4 per hour. Assume that firms were not providing such benefits prior to the legislation. On the following graph, use the green line (triangle symbol) to show the effect this employer mandate has on the demand for labor. Wage (Dollars per hour) 20 18 16 14 2 0 Demand 2 I I 3 4 5 6 Quantity of Labor (Thousands) 7 True 8 O False Supply Suppose employees place a value on this benefit exactly equal to its cost. Suppose the wage is free to balance supply and demand. 9 10 On the preceding graph, use the purple line (diamond symbol) to show the effect this employer mandate has on the supply of labor. New Demand New Supply Use the black point (plus symbol) to indicate the equilibrium wage and level of employment before this law, and use the grey point (star symbol) to indicate the equilibrium wage and level…Fill in the blanks: Workers Employed 0 1 2 3 4 Quantity Produced 0 15 25 33 39 Output Price ($) 10 10 10 10 10 Refer to the above table for a profit-maximizing, competitive firm. If the prevailing wage is $100, then the firm will hire worker(s).Give an example of how discrimination might persistin a competitive market.
- Imagine a type of discrimination where firms act as if they pay wf+df when they hire a female worker and wm when they hire a male worker. Where df is a discrimination coefficient. A) If female and male workers were the only inputs, what is the profit function for the firm? What is the firms profit maximizing demand for each type of labour? B) If the marginal product of male and female workers is the same, and if df = .1, what is the ratio of male to female wages? What does it mean to have a discrimination coefficient of .1? Carefully explain what it means.Question 26 of 30 Consider the labor market for electricians. The demand curve is downward sloping and the supply curve is upward sloping. In this market, however, there is a strong labor union. Assume that the electrician's union is able to negotiate a new contract that substantially raises their member's wages. Select the correct statement. Fewer people want to work as electricians as the union increases wage. Firms hire the same number of electricians at both wages. The wage increase is unambiguously beneficial for all the electricians working before the wage increase. O A consequer of the union negotiating a higher wage is fewer jobs for electricians. 8:25 PM 46°F 12/15/2021 aHomework (CH 18) Sizzler's produces charcoal grills in a small manufacturing facility and sells the grills in a competitive market. The following table presents the company's production function: Labor (Number of workers) 0 OUTPUT (Grills) 400 320 280 240 Use the blue points (circle symbol) to plot the production function for Sizzler's on the following graph. (?) 200 1 160 80 ! 0 Q A N 1 0 2 3 4 5 @ 2 Output (Grills) 0 90 175 245 300 325 LABOR (Number of workers) W S X # 3 E D 4 C 4 $ R F % 5 V Production Function T -O- G 6 B Y & 7 H U 8 ( M 9 K O ) 0 L P
