Immigrants return to potential gdp

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Reference no: EM137100

Q1. The short-run marginal cost of the Ohio Bag Company is 2Q. Price is $100. The company operates in a competitive industry. Currently, the company is producing 40 units / period. Elucidate the optimal short-run output? Calculate the profits that Ohio Bag is losing through suboptimal output.

Q2. Suppose that the United States cracks down on illegal immigrants and returns millions of workers to their home countries.

a. Explain what will happen to U.S. potential GDP, employment, and real wage rate.

b. Explain what will happen in the countries to which the immigrants return to potential GDP, employment, and the real wage rate.

Reference no: EM137100

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