3. Based on the data in problems (1) and (2) above,
(a) What is the competitive wage rate?
(b) Approximately what wage will the union seek?
(c) How many workers will the union have to exclude in order to get that wage?
Problems one and two
1. Complete the following table:
Quantity of labor
Marginal wage
(a) At what wage rate(s) is the marginal wage below the nominal wage?
(b) At what wage rate does the marginal wage first become negative?
2. Complete the following table:
Marginal factor
cost
Wage rate $14 $13 $12 $11 $10 $9 $8 $7
demanded 0 5 20 50 75 95 110 120
Wage rate $5 $6 $7 $8 $9 $10 $11
supplied 80 120 155 180 200 210 215
4. At the time of the National Football League strike in 1987, the football owners made available the
following data:
(a) Compute total revenues, total expenses, and profits both before and during the strike.
Total revenue
Total expense
Total profit
(b) Who was better positioned to endure the strike? A 5 NFL owners B 5 players
Source of Revenue Before the Strike During the Strike
Revenue
Television $973,000 $973,000
Stadium gate 526,000 126,000
Luxury box seats 255,000 200,000
Concessions 60,000 12,000
Radio