Show that the demand for labor is relatively elastic


Problem

Under the U.S. Social Security system, workers must contribute 6.2 percent of their wages (up to a maximum you can disregard here) and employers must also contribute 6.2 percent. Using the supply and demand for labor in the entire economy, show that if the demand for labor is relatively elastic and the supply isrelatively inelastic then workers pay relatively more than their stated 6.2 percent, and if the elasticities are reversed their employers do so.

The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.

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Macroeconomics: Show that the demand for labor is relatively elastic
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