Q. A. If real wage can adjust to equilibrate labour supply and labour demand, illustrate what is real wage? In this equilibrium, illustrate what are employment, output and total amount earned by workers?

B. Now Assume that Congress, concerned about welfare of working class, passes a law requiring industries to pay workers a real wage of 1 unit of output. How does this wage compare to equilibrium wage?

C. Congress cannot dictate how many workers industries hire at mandated wage. Given this fact, Illustrate what are effects of this law? Specifically, illustrate what happens to employment, output and total amount earned by workers?

D. Will Congress succeed in its goal of helping working class?

Q. An economy produces final goods and services with a market value of $5,000 billion in a given year, however only $4,500 billion worth of goods and services is sold to domestic or foreign buyers. Is this nation's GDP $5,000 billion or $4,500 billion? Elucidate your answer.