Question: Assume the local labor demand curve is given by w=200-2L and w=40.

a) What is the equilibrium quantity of labor employed?

ANSWER) L=80

b) The employed quantity of labor grow by 20. What's new labor demand curve?

ANSWER) W=160-2L

c) What is the implied labor multiplier (assuming that wages don't change) if the initial impulse AX equaled 14.2. (1) Given the labor demand curves from above and 'om part (b), assume now that wages are not constant but given by the labor supply curve w=0.5L. What is the resulting increase in L? What is the resulting multiplier assuming AX equaled 14.2 again