Labor Market
-On the graph above,suppose the labor market is in equilibrium at point 2,then the demand curve shifts down to the position shown on the graph.If the real wage has not changed,then the horizontal distance between points ________ measures the unemployment that results.

Question

Labor Market 
-On the graph above,suppose the labor market is in equilibrium at point 2,then the demand curve shifts down to the position shown on the graph.If the real wage has not changed,then the horizontal distance between points ________ measures the unemployment that results.

Quizplus · Accepted Answer

When the demand curve shifts down and the real wage has not changed, the equilibrium point moves from point 2 to point 1. The horizontal distance between points 2 and 1 represents the number of workers who were employed before the shift but are not employed after the shift, hence measuring the unemployment that results from the shift.

Labor Market -On the Graph Above,suppose the Labor Market Is in Equilibrium