Hey, how you doing? This is Mr. Clifford with ACDC Econ, Key Economic Concepts in 60 Seconds. Today we're talking about the resource market.
Your teacher already talked about buying and selling resources and how individuals, you and me, are suppliers and how firms are suppliers. now are the demanders. We're going to talk about the supply and demand for fast food cooks and then we're going to throw in the minimum wage and ask them some questions. I'm going to show you these concepts in 60 seconds. Here we go.
Instead of price, now we're looking at wage and we're looking at fast food cooks. So when the wage degrees really high and you own a business, you're going to hire a lot of workers or very few. Very few. When the wage is high, you're not going to hire very many. When the wage falls, you're going to hire a whole lot more.
So that's what the demand for labor looks like. Again, demand is now firms. You've got to get that in your head.
Demand is now firms. How about if you were a worker? If the wage is really low at $2, you're not going to work very much.
You're not going to get a job. But if the wage goes up eventually, you're going to go get a job as a fast food cook. Supply for labor, this is individual. All right, supply and demand meet each other right here.
They set the wage and they set the quantity. It looks like this. So let's just go ahead and say the wage is $10 an hour and put the quantity at 100. This could be 100,000. It could be anything. That's the concept.
Demand can shift right. Supply can decrease. There's these different shifters to determine what happens to the wage and quantity. That's it. Done.
See you next time. Here we go, bonus round. Now it's time to talk about minimum wage.
Let's talk about minimum wage. The government comes in and says, listen, $10 is just not enough to live on. The government says, we've got to put in a wage for it. It's like a price for it, except now it's with wage.
The question is, where is it going to go? Above or below $20? equilibrium. It's going to go above.
So let's say it's a $15 wage floor that looks something like this. Okay, just remember that a wage floor is kind of like a price floor, right? It's right here.
The wage can't get down to $10 because the government says you can't hire workers for less than $10. than 15. So this is 50, 100, and 120. I have three questions for you, they're right here. I want you to pause this video and see if you can answer them. First question is number of workers that were fired because of the minimum wage, number of workers who entered the industry because now it's at a higher wage, and last one, number of workers who are now unemployed because of this new law. Again, take a look right here, Fast Food Cooked.
Stop the video to see and answer these three questions. Good luck. Alright, how'd you do? Did you do good?
You got it? Alright, let's find out. Number of workers fired. Well, take a look up here, right? This is where we were before.
When the wage increased, firms decided to hire less workers. The quantity demanded decreased. Quantity demanded decreased.
And so you went from 100 to 50, so that means 50 workers, 50 workers ended up losing their job. Okay, well how many workers jumped in? Well, the number of workers that went in, well we weren't 100 before. When the wage increased, the quantity supplied increased.
and therefore now we had 120 people who want a job went from 120 answers 20 how about the number of people unemployed well that's easy the people who wanted a job who can't get a job will they're right there between 120 and 50 this is a surplus but it's not a surplus of product it's a surplus of workers that's unemployment right in this situation it's 70 people unemployed that's it till next time