Assume that the market for unskilled fast food workers is given by the following equations:
Demand P = 6.00 - .003Q
Supply P = 4.00 + .002Q
Where P is the price of labor (wage rate/hour) and Q is the quantity of labor hours per day
(a) Find the equilibrium price and quantity solving the two equations. Show graphically the demand and supply curve and mark the equilibrium wage on the graph (no graph no points).
(b) Suppose the government imposes s minimum wage of $5.50 per hour. What is the result in the market? Is there a shortage or surplus? Of how much? (you must figure out the total number of workers either surplus or deficit at the minimum wage of $5.50)