Question
Hi, I need microeconomics help please
Consider the labor market for the fast-food industry, which consists mainly of high school and college students. Assume that all fast-food restaurants are p (blue curve) and market supply curve (arange curve) for student workers, who are responsible for making hamburgers rofit maximizing. The calculator below shows the market demand curve At any time in this problem, you can click the Reset to Initial Values button to returm the elements in the calculator to their original positions. You will not be graded on any changes to the calculator; it's just here to help you answer the following questions. Tool tip: Use your mouse to drag the horizontal green line an the graph. The values in the boxes on the right side of the calculator will change accordingly. You also can directly change the values in the boxes with the white background by clicking in the box and typing. The graph and any related values will change accordingly. WAGE LABOR MARKET CALCULATOR Wage Labor Demanded 14 18 7 Labor Supplied 83 Thausands al warkersl 14 12 LABO Hours of Training Price of a Hamburger 0 10 20 30 40 50 0 B0 90 100 QUANTITY OF LAB0R (Thausands of warkers Reset ta Initial Va When the price of a hamburger is $3, the equilibrium wage in the fast-food labor market is $14 per hour Suppose that the demand for hamburgers increas would result in a new equilibrium employment level and wage in the labor market for young people who work in fast-food restaurants Suppase that the demand for hamburgers increases enough so that the price of a hamburger doubles. Ordinarily, this However, restaurants claim they can only afford to pay the initial equilibrium wage. In this labor market, if the price af hamburgers doubles, but restaurants continue to pay the equililbrium wage that prevailed before the increase in demand for hamburgers, there will be a labor of
Explanation / Answer
it is better to hire 3 units of labor to get more profit
b. even in this case also he can be maximized his profits at 3units labor only.
c. less demand, low purchases
d. hiring 2 units labor will provide higher profits ($70)
workers productivity total cost total reve profit 0 0 0 0 0 1 20 200 260 60 2 38 400 494 94 3 54 600 702 102 4 68 800 884 84 5 80 1000 1040 40
