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a) Graph a labor supply curve with an upward-sloping labor supply. Label the vertical axis as...

a) Graph a labor supply curve with an upward-sloping labor supply. Label the vertical axis as “wage rate” and the horizontal axis with “Quantity of labor” a. Place these two points on the curve: {wage= $10, quantity = 30} and {wage = $12, quantity = 45}. Calculate the labor supply elasticity. Label this curve as “Curve A”

b) Now, assume that something has changed the labor supply curve so that now the line has a different slope. On this new curve are the points {wage = $10, quantity = 30} and {wage = $12, quantity = 37}. Calculate the new labor supply elasticity. Draw this curve on the same graph as Curve A, label this new curve “Curve B”

c) Is the new curve MORE elastic or LESS elastic? ______________

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