(Transcript of audio with descriptions. Transcript includes narrator headings and description headings of the visual content)
(Speaker)
This question is going to ask you to analyze the labour market for Profunctia and calculate the levels of unemployment, employment, and labor force for three different cases.
(Description)
On the Figure there are graphs of labor supply and demand. Horizontal axis corresponds to the quantity of labor (in thousands). Quantity of labor ranges from 0 to 100. Vertical axis corresponds to wage rate (in dollars). Wage rate ranges from 0 to 20 dollars. Two straight lines (supply and demand) are plotted with supply line passing through origin and point with coordinates (100, 20), and demand line passing through points with coordinates (0,20) and (100,0). Lines intersect at point E (50,10).
(Speaker)
You were first asked to find the equilibrium wage rate, which is the wage that equates labor demand with labor supply. The equilibrium wage occurs at the intersection of labor demand and labor supply, which is 10 dollars.
(Description)
What is the equilibrium wage rate in Profunctia? The line parallel to quantity of labor axis is drawn through the intersection point, and it intersects with wage rate axis at 10 dollars.
(Speaker)
At a wage of 10 dollars, you confine the equilibrium quantity of labor to be 50000 workers.
(Description)
At the equilibrium wage rate, what is the level of employment? At the equilibrium wage rate, what is the size of the labor force? The line parallel to wage rate axis is drawn through the intersection point, and it intersects with quantity of labor axis at 50000.
(Speaker)
When the labor market is in equilibrium, the unemployment rate will be 0 percent.
(Description)
At the equilibrium wage rate, what is the unemployment rate? Intersection point for suply and demand is labeled as "in equilibrium the unemployment rate is 0 percent".
(Speaker)
At a wage of 10 dollars, labor demand equals labor supply, which implies no one is unemployed that is willing to work for a wage rate of 10 dollars.