question archive When the wage is $10 per hour, demand for workers is 30 hours per week on average
When the wage is $10 per hour, demand for workers is 30 hours per week on average
Subject:EconomicsPrice:2.88 Bought3
When the wage is $10 per hour, demand for workers is 30 hours per week on average. The wage then increased to $12 per hour, and the demand for workers decreased to 27 hours of work per week on average. What is the elasticity of labor coefficient for this group?
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Let w denote the wage and Q denote the demand for labor. The elasticity of labor coefficient can be calculated as:
[Math Processing Error]E=(Q1−Q0w1−w0)(Q0w0)=(27−3012−10)(1030)=−0.5
Thus, the elasticity of labor coefficient for this group is -0.5.
