Determine the deadweight loss

Reference no: EM1369972

Suppose that the demand for labor by firms is given by L = 1000 - 100W and the supply of labor from workers is given by L = -400 + 100W, where L represents the number of workers and W is the wage in this labor market.

a. What are the equilibrium levels of W and L in this labor market?

b. Suppose the government imposes an income tx of 25% on workers. The workers aftertax wage, W(w), will then be equal to the wage paid by firms, W(), times (1-t). What will the new equilibrium levesl for W(f), W(w), and L be in this labor market?

c. What is the governments tax revenu and the deadweight loss from the income tax?

Reference no: EM1369972

Questions Cloud

How can hr manager steve enforce discipline : When Steve requests the department heads to implement corrective measures, few take him seriously. Analyze how Steve and his team can enforce discipline at the workplace by addressing each of his issues.

Find the government tax revenue : Assume NJ government decides to impose a $1,000 per student tax on colleges Every college has to pay $1,000 for each student enrolled.

Importance and benefits of critical thinking : Example from your personal experience in applying critical thinking to a work-related decision, and the importance and benefits of critical thinking in the decision-making processes.

Estimating profit maximizing price : Assume there're three firms with the same individual demand function. This function is Q=1,000-40P. Assume each firm had the diffeerent cost function these functions are: Firm 1: 4,000+ 5Q

Determine the deadweight loss : Assume that demand for labor by firms is given through L=1000-100W and the supply of labor from workers is given by L=-400+100W, where L represents the number of workers and W is the wage in this labor market.

Return boolean value true if string in array is palindrome : Write the recursive method testPalindrome which returns boolean value true if string stored in array is palindrome and false otherwise. Method must ignore spaces and punctuation in string.

How management expects technology to improve business : Show how companies' current technology is meeting or not meeting business needs - Business Technology

Describe whether the resistance to change was caused : Describe whether the resistance to change was caused by an internal and Explain a situation where you or someone you know was resistant to change as identified in one of following areas

Determining total cost function : A Firm has total cost function given by following: What is the Total fixed cost when Q = 100? And Average fixed Cost when Q=100?

User Account

All Pages