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Assume the labor demand for unskilled workers in a city in Texas is given by L D = 80 2W. The labor supply curve of natives (i.
Assume the labor demand for unskilled workers in a city in Texas is given by LD = 80 − 2W. The labor supply curve of natives (i.e., non-immigrants) is given by LS = −20 + 8W, where W is the hourly wage.
- Calculate the equilibrium level of employment and wage rate if there are no immigrants.
- Suppose the arrival of Mexican immigrants shifts out the labor supply curve to LS = −5 + 8W. Calculate the new equilibrium level of employment and wage rate.
- What has happened to the employment level of natives as a result of the immigrant arrival? What has happened to the unemployment rate of unskilled native workers?
Once again - this was flagged for missing information. All of the provided info is there, exactly as the professor provided it to the class for extra practice. I know the answers, just need to know what steps are taken to arrive at the answers.
1) L* = 60 and W* = $10
2) L* = 63 and W* = $ 8.50
3) Native employment fell by 12 workers. The unemployment rate for unskilled workers both before and after immigration is zero since the labor market is in equilibrium.