Poornima is a stay-at-home parent who lives in San Francisco and teaches tennis lessons for extra cash. At a wage of $30 per hour, she is wi

Question

Poornima is a stay-at-home parent who lives in San Francisco and teaches tennis lessons for extra cash. At a wage of $30 per hour, she is willing to teach 3 hours per week. At $50 per hour, she is willing to teach 7 hours per week. Using the midpoint method, the elasticity of Poornima’s labor supply between the wages of $30 and $50 per hour is approximately(1.6,0.13,0.63,25) , which means that Poornima’s supply of labor over this wage range is (elastic, inelastic)

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Parker 1 week 2021-10-12T12:40:08+00:00 1 Answer 0

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    2021-10-12T12:41:40+00:00

    Answer:

    We can deduce that the elasticity of the labor supply is greater than 1 the labor supply is considered elastic

    Step-by-step explanation:

    The formula to use is the following:

    Elasticity = (Change in working hours / Average working hours) / (Change in wage rate / Average wage rate)

    we replace the data

    Elasticity = [(7 – 3) / (7 + 3) / 2] / [(50 – 30) / (50 + 30) / 2]

    Elasticity = [4 / (10/2)] / [20 / (80/2)]

    Elasticity = (4/5) / (20/40)

    Elasticity = 0.8 / 0.5

    OUTCOME

    Elasticity = 1.6

    We can deduce that the elasticity of the labor supply is greater than 1 the labor supply is considered elastic

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