The table below shows the quantity demanded and supplied in the labor market for

Question

The table below shows the quantity demanded and supplied in the labor market for economics professors at the I'MaStateUniversity, where all the professors belong to a union. Annual Salary Quantity of workers demanded Quantity of workers supplied $50,000 95 20 $60,000 80 30 $70,000 65 40 $80,000 50 50 $90,000 35 60 $100,000 20 70

If the union has enough negotiating power to raise the annual salary by $20,000 more than a non-unionized university would be willing to pay, then there will be excess ___ of labor of ___ economics professors. demand, 50 demand, 25 supply, 50 supply, 25

Explanation / Answer

first of all in case of non-union there will be equilibrium levels of demand and supply, so at 80,000 they will be demand and supply equal to 50.

now if 20,000 is raise , it will reach 100,000 where demand is 20 and supply is 70, so oversupply of 50 almost

so the right answer will be:

supply,50

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