Suppose the Market for Landscape Workers in Kitchener, Ontario, Can

Essay

Suppose the market for landscape workers in Kitchener, Ontario, can be described by the following labour demand and supply equations: LD = 340 - 10w and LS = 100 + 20w.
a) Calculate the equilibrium wage and employment in this market.
b) Suppose the local government passes a bill requiring all employers in this industry to provide bottled water to each worker to protect them from hot weather. This has been estimated to cost employers $1 per worker per hour. This way, workers do not need to purchase water by themselves, so that the bill effectively increases the wage by $1 per hour. What are the new labour demand and supply equations?
c) Calculate the new equilibrium wage and employment. Draw a graph to show the change.