Assignment 10.1 - Labor and Resource Markets

You are given a scenario where this a change in a factor of production or a change in demand for an item. You need to explain in sentence form how this would change demand for labor. See the example and model your answers after how the example is written.

All questions in this assignment are worth 10 points.

Change in Factor of Production Effect on Labor Market

Example: There is a decrease in the price of oil, and you make plastic containers. The decrease in the price of oil will make it cheaper to produce plastic containers. The firm can lower its price and it will sell more. This will increase the demand for labor at your firm.

Apple develops the iPhone and demand for it surges as people realize the benefits of this improved technology. You manufacture flip phones.

You own a sports equipment manufacturing firm. You were just informed rent at your warehouse space would double.

You develop a popular video game and continue to develop new versions to keep people interested in the game.

The coronavirus pandemic forces people to shelter in place. You are an airplane mechanic looking for work in Louisville where UPS is headquartered.

There is an increase in the price of steel. You make tractors.

Would you expect the presence of the labor unions to lead to higher or lower pay for worker-members in the short run? What about the long run?

How would the presence of a union affect the firm's motivation to invest in technology? How would this affect the number and type of workers it would hire in the short run? What about the long run? (Remember to think about how quickly firms can adapt to changing circumstances.)

If you worked for a union, would you accept higher wages if it meant others would be laid off? Why or why not?

Draw a picture of the backward bending supply curve. Make it your individual supply curve with wages you would accept and the time you would be willing to work. Have at least five points that connect together to make a curve. Your curve can be drawn, or you can use excel to create a chart.

Explain your rationale for how you drew you labor supply curve.