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Construction workers in the town of Cortland, NY have Cobb-Douglas utility for labor and consumption, U(L) = (20-L)C, MRS=C/(20-L) where is the number of hours
- Construction workers in the town of Cortland, NY have Cobb-Douglas utility for labor and consumption,
U(L) = (20-L)C, MRS=C/(20-L)
where is the number of hours of labor supplied in a day andis the dollar amount of consumption goods purchased with wage income (pc=$1).R=20-L is the number of hours of leisure that the worker has during the day.
- Derive the labor supply function for workers in Cortland.
- Draw the labor supply curve on a graph withon the horizontal axis andon the vertical axis.
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