Answer to Question #54911 in Microeconomics for G

Question

29. Predict how each of the following events will raise or lower the equilibrium wage and quantity of coal miners in West Virginia. In each case, sketch a demand and supply diagram to illustrate your answer.
a. The price of oil rises.
b. New coal-mining equipment is invented that is cheap and requires few workers to run.
c. Several major companies that do not mine coal open factories in West Virginia, offering a lot of
well-paid jobs.
d. Government imposes costly new regulations to make coal-mining a safer job.

Answer 1

Predict how each of the following events will raise or lower the equilibrium wage and quantity of coal miners in West Virginia.
a. The price of oil rises - the demand for miners rises, so the wage and quantity rises too.
b. New coal-mining equipment is invented that is cheap and requires few workers to run - the demand for miners falls, so the wage and quantity falls too.
c. Several major companies that do not mine coal open factories in West Virginia, offering a lot of well-paid jobs - the supply of miners falls, so the wage increases and quantity decreases.
d. Government imposes costly new regulations to make coal-mining a safer job - the supply of miners rise, so the wage decrease. and quantity increases.