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What am I doing wrong? All color lines are my graph. The original question is in black Question 3 There are a total of 700
What am I doing wrong? All color lines are my graph. The original question is in black
Question 3
There are a total of 700 units of labor in the economy, and workers can either seek employment in one of two sectors: Sector 1 or Sector 2. The graph below depicts the marginal revenue product curves for both sectors in the economy before the introduction of international trade.
l Jill]- 3-[l' III! 5011} Eli) MI] Port [1]: Suppose that the marginal pro-duct of the 2GB\" unit of labor in Sector 1 is 4 units of output. That is, hiring the ltllii'th unit of labor in Sector 1 increases the quantity:r of output bv 4 units in that sector. What is the price of output sold in sector 1? Answer: \"the price of output sold in sector 1 is 513 Port {ii}: Suppose that perunit price of output sold in Sector 2 is $3. 1Il'v'hat is the marginal product of the 200'\" unit of labor that is emploved in Sector 2? Answer: MP of the zoo\" unit of labor that is employed in Sector 2 is 1. Port {iii}: Identify the allocation of the Film workers such that there is no incentive for additional migration between the two sectors. Answer: "the new equilibrium wage is $15 and 35!] workers will rema'm in the sector 2 while 151] of its workers will move to Sector 1. The Sector 1 workers' wage will drop from $13 to $16, meanwhile the Sector 2 workers' wage will increase from $3 to 515 Port {iv}: Suppose that the countr'lllr begins to export the product sold by Sector 2, and as a result, 10D workers migrate from Sector 1 to Sector 2. Ev how much did exporting increase the marginal revenue product of each unit of labor in Sector 2? Port {v}: Suppose that the countrv begins to export the product sold by Sector 2, and as a result, III] workers migrate from Sector 1 to Sector 2. Ev how much does the equilibrium wage rise in each sector? Port {vi}: Exporting leads the marginal revenue product of labor curve in the agricultural sector to shift upward. what is the source of this upward shiftStep by Step Solution
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