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1) A union representing 400 workers faces a Labor demand curve given by w-500-L where Lis the number of workers employed, and w is the weekly wage, measured in dollars. What wage rate should the union set to maximize the total wage income of all of its members? b) Now suppose that unemployment benefits of $100 per week become available to those workers who are not hired at the union wage. What wage rate should the union set in order to maximize total income (including both wage income and unemployment benefits)?

1) A union representing 400 workers faces a Labor demand curve given by w-500-L where Lis the number of workers employed, and w is the weekly wage, measured in dollars. What wage rate should the union set to maximize the total wage income of all of its members? b) Now suppose that unemployment benefits of $100 per week become available to those workers who are not hired at the union wage. What wage rate should the union set in order to maximize total income (including both wage income and unemployment benefits)?

Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter14: Labor Markets And Income
Section: Chapter Questions
Problem 1SCQ: Table 14.10 shows levels of employment (Labor), the marginal product at each of those levels, and...
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1) A union representing 400 workers faces a Labor demand curve given by w-500-L where Lis the number of workers employed, and w is the weekly wage, measured in dollars. What wage rate should the union set to maximize the total wage income of all of its members? b) Now suppose that unemployment benefits of $100 per week become available to those workers who are not hired at the union wage. What wage rate should the union set in order to maximize total income (including both wage income and unemployment benefits)?
Transcribed Image Text:1) A union representing 400 workers faces a Labor demand curve given by w-500-L where Lis the number of workers employed, and w is the weekly wage, measured in dollars. What wage rate should the union set to maximize the total wage income of all of its members? b) Now suppose that unemployment benefits of $100 per week become available to those workers who are not hired at the union wage. What wage rate should the union set in order to maximize total income (including both wage income and unemployment benefits)?
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