1) The union and the firm are bargaining over a wage. The union's wage strategy is to offer Wu (t) = wu0 exp{-.01t} where wuo is the union's initial offer and t measures the length of the strike in weeks. The firm's strategy is to offer Wf (t) = wfo exp{.02t} where is the firm's initial offer. W f0 If wuo 100 and wfo=50, how long does the strike last? How does your answer change if wu (t) and wf (t) are common a) b) knowledge?

1) The union and the firm are bargaining over a wage. The union's wage strategy is to offer Wu (t) = wu0 exp{-.01t} where wuo is the union's initial offer and t measures the length of the strike in weeks. The firm's strategy is to offer Wf (t) = wfo exp{.02t} where is the firm's initial offer. W f0 If wuo 100 and wfo=50, how long does the strike last? How does your answer change if wu (t) and wf (t) are common a) b) knowledge?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose that in a competitive output market, firms hire labor from a competitive labor market (so that the profit maximization conditions for hiring labor are as we discussed in class). If a profit-maximizing firm in this market gets an improvement in technology that increases the marginal product of labor for any given unit of labor it employs, and if the market wage stays constant, we would expect the firm to Group of answer choices a) offer a lower wage and hire fewer units of labor. b) hire more units of labor. c) do none of the other options. d) keep the number of units of labor the same. e) hire fewer units of labor (i.e., workers) because it could produce more than before with fewer people.
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Consider a small, remote town with only one employer - a pulp and paper mill. Suppose there are currently 600 workers, each of whom is paid $5000 per month. In order to attract one additional worker, the employer must increase all workers' wage to $5100 per month. What is the marginal cost to the firm of hiring the additional worker? Show transcribed image text . Consider a small, remote town with only one employer - a pulp and paper mill. Suppose there are currently 600 workers, each of whom is paid $5000 per month. In order to attract one additional worker, the employer must increase all workers' wage to $5100 per month. What is the marginal cost to the firm of hiring the additional worker?
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Signaling ability through schooling all workers. O increases O decreases O has no effect on the average wage of