Suppose a harsh winter in Normandy destroys part of the French apple crop.

a. Explain what happens to the price of apples and the marginal product of apple pickers as a result of the freeze. Can you say what happens to the demand for apple pickers? Why or why not?

b. Suppose the price of apples doubles and the marginal product falls by 30 per cent. What happens to the equilibrium wage of apple pickers?

c. Suppose the price of apples rises by 30 per cent and the marginal product falls by 50 per cent. What happens to the equilibrium wage of apple pickers?