Find substitution effect on labor hired due to wage increase

Reference no: EM13191579

Before submitting these Questions, if it is hard for you to post graphs, please answer me in words what the graphs would look like. Then, I will try to graph myself.

1. Assume two inputs, K and L. Illustrate the following cases with two graphs:

(1) the substitution effect on labor hired due to a wage increase is zero.

(2) the scale effect on labor hired due to a wage increase is zero.

2. Assume two inputs, K and L. Illustrate the following cases with two graphs:

(1) Draw the VMPL and VAPL curves for the case of a perfect-complements production function, Q = min(K,L).

(2) Graph the corresponding demand curve for labor.

Reference no: EM13191579

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