1.Suppose there are two labour markets in the country: Market #1 supply S1w1 = 60+ 0.5N1...

 

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1.Suppose there are two labour markets in the country: Market #1 supply S1⇒w1 = 60+ 0.5N1 and demand D1 ⇒w1=160-0.5N1 Market #2 supply S2 ⇒w2=40+ N2 and demand D2 ⇒w2 = 180 - N2 with w as wage and N as number of workers. 1. Plot the supply and demand curves in each market. Determine the equilibrium wage w employment N *, and total wage bill TWB* In each market. 2. Suppose Market #1 Is unlonized with unlon wage w1 = 130. Use the given equations to determine the quantity supplied N1 S and demanded N1 D of labour. Calculate the adverse employment effect, Induced unemployment effect, Involuntary unemployment, and total wage bill TWB 1. Plot your results in the graph for Market #1. 3. Explain how the spillover works Into Market #2. Determine the equation for the effective labour supply curve 52 and plot It In the graph for Market #2. Determine the equilibrium wage w2, employment N2, and total wage bill TWB 2 In Market #2. 4. Use your results to evaluate this statement: "Gains for union Insiders come at the expense of outsiders." 1.Suppose there are two labour markets in the country: Market #1 supply S1⇒w1 = 60+ 0.5N1 and demand D1 ⇒w1=160-0.5N1 Market #2 supply S2 ⇒w2=40+ N2 and demand D2 ⇒w2 = 180 - N2 with w as wage and N as number of workers. 1. Plot the supply and demand curves in each market. Determine the equilibrium wage w employment N *, and total wage bill TWB* In each market. 2. Suppose Market #1 Is unlonized with unlon wage w1 = 130. Use the given equations to determine the quantity supplied N1 S and demanded N1 D of labour. Calculate the adverse employment effect, Induced unemployment effect, Involuntary unemployment, and total wage bill TWB 1. Plot your results in the graph for Market #1. 3. Explain how the spillover works Into Market #2. Determine the equation for the effective labour supply curve 52 and plot It In the graph for Market #2. Determine the equilibrium wage w2, employment N2, and total wage bill TWB 2 In Market #2. 4. Use your results to evaluate this statement: "Gains for union Insiders come at the expense of outsiders."

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ANS 1a Market 1 Supply w wage 110 0 Wage ito N employment Market 2 Supply W howN Demand 180N At equ... View the full answer