Essay
Suppose the marginal product of labor in the economy is given by MPN = 200 - 0.5 N,while the supply of labor is 100 + 4w.
(a)Find the market-clearing real wage rate.
(b)What happens if the government imposes a minimum wage of 40? Is there involuntary unemployment?
(c)What happens if the government imposes a minimum wage of 60? Is there involuntary unemployment?
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