PROBLEM ON EMPLOYMENT
I. Plot a short run aggregate production function that includes the following
information:
Labor Real GDP
(Billion hours per year) (Billions of 1990 Tenge)
4 80
5 90
6 98
7 104
8 108
II. Plot a labor market diagram that illustrates the following information:
Real Wage Quantity of Labor Quantity of Labor Demanded Supplied
(1990 1,000 tenge/hour) (Billion hours per year) (Billion hours per year)
5 7 5
7 6 6
9 5 7
10 4 8
III. Assume that the money wage is fixed at 7 thousand Tenge per hour. Make
the following calculations based on the production function and the labor
market information shown above for the assumed values of the GDP deflator:
GDP Deflator Real Wage Employment Real GDP
140
100
70
IV. Plot the short run aggregate supply curve and the long run aggregate
supply curve for Kazakhstan.
V. What would be the effect of an increase in labor productivity on the
aggregate supply curve?
VI. What would be the effect of a decrease in the supply of labor on the
aggregate supply curve?