Exhibit 12-6 If the market represented in Exhibit 12-6 is allowed to operate freely, total employment in the market will be

Question

Exhibit 12-6  If the market represented in Exhibit 12-6 is allowed to operate freely, total employment in the market will be

Quizplus · Accepted Answer

The market equilibrium occurs at the intersection of the supply and demand curves. In this case, the equilibrium occurs at a wage rate of $4 and a quantity of 180 workers. Therefore, if the market operates freely, the total employment in the market will be equal to the equilibrium quantity, which is 4 times 180, or 720 workers.

Exhibit 12-6 If the Market Represented in Exhibit 12-6