Question

Demand function: P = 20 – 0.75Q
Supply function : P = 2 + 0.25Q
where P is the wage per hour, and Q represents the number of bus drivers hired, in thousands (e.g. Q = 1 means that 1,000 drivers have been hired).

After a brief rebellion, bus drivers in Endor successfully argue for a minimum wage law. The minimum wage law requires that all bus drivers earn at least $11 per hour. Ho w many drivers will be employed under this new minimum wage? Also, what is the amount of unemployment at $11 per hour ? Depict your answers in the above diagram.

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