Problem 3 You've been given the following labor demand and supply functions: LD=15% L5=w (a) What is the optimal level of employment? What is the optimal wage? (b) Graph the labor demand and supply. (0) What are the gains from trade at this equilibrium? Hint: Remember gains from trade is the same as welfare. ((1) Now, assume the government has implemented a minimum wage of $20. What is the new demand and supply? (e) Based on your answer above, do we have a surplus or a shortage? How many workers are displaced/ enter the workforce? (f) Graph your new labor demand and supply. (g) What are the gains from trade at this equilibrium? (h) Are we better or worse after this minimum wage? Explain