4. The WSJ article titled "The Perk-Cession Is Under Way at Some Companies" (wsj.com/articles/the-perk-cession-is-under-way-at-some-companies-9cb04e9c?mod= business_lead_pos5)

reports that firm are reducing the perks they are making available to employees. Here is a quote from the news article:

Companies are cutting back on prized employee perks from fancy coffee to free cab rides as they vow to trim costs and prioritize efficiency. These extras, above and beyond traditional healthcare and retirement plans, were meant to make workers want to join companies and stay there. They've grown to be seen by some as a form of compensation, so the cuts can sting.

The cuts sometimes run alongside layoffs. Before Facebook parent Meta Platforms Inc. laid off 11,000 workers, it ended free laundry and dry cleaning services for employees. Twilio Inc., which has had two rounds of job cuts in five months, slashed its employee allowances for spending on wellness and books. Salesforce, which is cutting 10% of global staff, is also dialing back a bevy of coveted benefits. Specialty-coffee baristas at the company's San Francisco tower were shown the door. The company cut ties with Trailblazer Ranch, a 75-acre wellness retreat that mixed skills training with yoga and hiking. Also gone: the extra paid day off every month Salesforce gave employees for well-being.

(a) (5 points) Using a simple demand and supply graph explain how these disappearing perks affects firm costs and the implication it can have on firm production and service prices? Be sure to draw the graph and show any shifts and movements along the curves. Provide a one paragraph explanation of your analysis.

(b) (5 points) Using a simple demand and supply graph explain how these disappearing perks affects the supply and demand for labor? Be sure to draw the graph and show any shifts and movements along the curves. Provide a one paragraph explanation of your analysis.