Increasing the Wage
Just a table on what the effect of increasing a wage would be. It is assuming that it takes one hour to make one loaf of bread.
Row 1 is before, row 2 is if bread price does not increase, row 3 is if bread price increases such as the profit increases at the same dollar rate as labor, and row 4 is if bread price increases as the profit increases at the same percentage rate as labor. Labor / bread is how many loaves a laborer can afford per one hour’s work, profit / bread is how many loaves the owner can afford per loaf sold. Unaffected / bread is how many loafs someone whose income did not increase can afford.
|cost of bread||labor / hour||profit / hour||labor / bread||profit / bread||unaffected / hour||unaffected / bread|
|$1.00||$0.50||$0.50||0.50||0.50||$5.00||5.00||increase in labor|
|$1.50||$1.00||$0.50||0.67||0.33||$5.00||3.33||same $ increase||$0.50|
|$2.00||$1.00||$1.00||0.50||0.50||$5.00||2.50||same % increase||100%|