ECON 213 PROBLEM SET 2 Complete Solution
Problem Set 2
Name: __________________________________________
Problem Set 2 is to be completed by 11:59 p.m. (ET) on Monday of Module/Week 4.
(HINT: in the labor market the roles are reversed. Those who want to hire labor are the demanders. The workers enter the work force providing labor to the market place so they are the suppliers.)
Wage |
Quantity Demanded |
Quantity Supplied |
$50,000 |
20,000 |
14,000 |
$60,000 |
18,000 |
18,000 |
$70,000 |
16,000 |
22,000 |
$80,000 |
14,000 |
26,000 |
$90,000 |
12,000 |
30,000 |
What is the equilibrium wage? ___________________________________
Now, consider this scenario: Due to an increase in the internet security threats, the government wants to apply a price control in this market to encourage more people to become internet security professionals. Assume that a wage control is set at $75,000. Will this increase the number of people entering this labor market? Why or why not? Will this increase the number of people hired? Why or why not?
Your job is to:
ECON 213 PROBLEM SET 2 Complete Solution
Lobbyists will want lower prices for crackers so that they are cheaper and more affordable by kids. A price cap is a maximum price that can be charged for the crackers. Since the free market charges P*, the cap must be less than fre...
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