Bookings for live performances increase, so event organisers want to employ more sound engineers. The supply of sound engineers is unchanged. Why is the equilibrium wage likely to rise?
At the original wage, excess demand makes organisers offer more to recruit engineers.
Organisers raise wages because a higher wage increases the quantity of labour they demand.
Engineers ask for higher wages because they must compete more strongly for each vacancy.
Organisers raise wages because higher labour costs increase demand for live performances.
149 exam-style questions on AQA GCSE Economics 1.5 Competitive and concentrated markets, covering 1.5.1a The range of market structures, 1.5.1b Distinguishing between market structures, 1.5.2a Characteristics of a competitive market, 1.5.2b How producers operate in competitive markets, 1.5.2c The economic impact of competition, 1.5.3a Characteristics of a non-competitive market, 1.5.3b How producers operate in non-competitive markets, 1.5.3c Monopoly and oligopoly, 1.5.4a The labour market and wage determination, and 1.5.4b Gross and net pay. Each one has a worked solution and a mark scheme showing where the marks go.