The figures given below show the demand (D)and supply (S) curves of labor in two different markets. Figure 15.3
-Refer to Figure 15.3.If the wage rates in market A and market B were set at $15,then:

Question

The figures given below show the demand (D)and supply (S) curves of labor in two different markets. Figure 15.3  
-Refer to Figure 15.3.If the wage rates in market A and market B were set at $15,then:

Quizplus · Accepted Answer

At a wage rate of $15, the quantity of labor demanded in market A is QdA=60, while the quantity of labor supplied in that market is QsA=40, so there would be a shortage of workers (QdA-QsA=20). On the other hand, in market B the quantity of labor demanded is QdB=40, while the quantity of labor supplied is QsB=60, so there would be a surplus of workers (QsB-QdB=20). Therefore, overall, the labor market would not be in equilibrium, and there would be a shortage of workers in market A and a surplus of workers in market B.

The Figures Given Below Show the Demand (D)and Supply (S)