Economics: The Basics 1st Edition by Mike Mandel

Exercise 9

Suppose a new law is passed in the United States requiring that every full-time worker receives eight weeks of vacation per year. (That's a lot, since today the average worker with 10 years on the job gets only three weeks of vacation.)a) What will happen to the labor demand curve after the law is passed? ( Hint: Will employers be more or less willing to hire workers?)b) Will the labor supply curve shift to the left, to the right, or stay the same?
c) What will happen to the wage and the number of workers employed? Illustrate your answer using a supply-demand diagram.