1) You are hired by the government toevaluate the impact of a policy change thataffects one group of individuals but notanother. Suppose that before the policychange, members of a group affected by thepolicy averaged 16,431 in earnings, andmembers of a group unaffected by the policyaveraged 14,634. After the policy change,members of the affected group averaged17,126 in earnings while members of theunaffected group averaged 15,250 inearnings. What is the estimated effect of thepolicy on individuals' earnings? (Note that theeffect of the policy may be positive ornegative. ) Your answer should be a numericalnumber only (positive or negative). 2)Ben is choosing between cookies and soda.Denote the marginal utility of cookies is MUc,and the marginal utility of soda is MUs. Whichof the following relationship is true regardingthe marginal utility of substitution (MŘS) ofcookie in terms of soda?A) MRS= MUcB) MRS = MUSC) MRS = MUS / MUCD) MRS = MUc / MUs

“Since you have asked multiple questions, we will solve the first question for you. If you want any…

Answered: 1) You are hired by the government to…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Calculate MPL & MRP to determine how many employees the firm should hire. 1) Calculate MPL and the MRP of the business. We can assume that price = $3 and that the business must pay a wage to its employees of $20 per day. # of employees: Output MPL MRP 1 90 120 132 4 140 5 142 6 143 A*Based on these numbers, how many employees should this business use? Explain your answer. B*Show what the graph would like this for this firm if we have lines for wage and MRP. Show where they would cross and the optimal number of employees used also C*Explain what you think would happen if demand went up for the product and now price goes up to $4. LO
Consider Special City that manufactures light fixtures that are sold around the world. Draw their base case Labor Market graph. Now assume there is a national shortage of glass that Special City manufacturers use to create their light fixtures. Show what would be the effect on your Labor Market graph. Lastly, assume the manufacturers change their manufacturing process to use less glass but inadvertently create a very noticeable increase in the smog levels that makes it hard to breathe. Show another variation to reflect the change in your labor market graph, be sure to indicate the effects of the changes on for each of these market changes or combine the graphs, just be sure the changes and new equilibria are legible:
The Zippy Paper Company has no control over either the price of paper or the wage it pays its workers. The following table shows the relationship between the number of workers Zippy hires and total output: Labor Input (workers per day) Total Output (boxes of paper per day) 0 0 1 15 2 27 3 36 4 43 5 48 6 51 Assuming the selling price is $10 per box, answer the following questions: What is the marginal revenue product (MRP) of each worker? How many workers will Zippy hire if the wage rate is $100 per day? How many workers will Zippy hire if the wage rate is $75 per day? Assume the wage rate is $75 per day and the price of a box of paper is $20. How many workers will Zippy hire?
The government wants to encourage individuals on welfare to become employed. It is considering two possible incentive programs: a. Give firms $2 per hour for every individual on welfare who is hired. b. Give each firm that hires one or more welfare workers a payment of $1,000 per year, irrespective of the number it hires. To what extent is each of these programs likely to be effective at increasing the employment opportunities of welfare workers? Giving firms $2 per hour for every individual on welfare who is hired O A. is likely to be unsuccessful because firms hire workers such that the marginal revenue product of labor equals the marginal cost of labor, and this approach reduces the marginal cost of labor by $2, decreasing employment. O B. is likely to be unsuccessful because the substitution effect from a wage decrease is negative in terms of hours of work. OC. may be successful or may be unsuccessful depending on whether the income effect or the substitution effect from a wage…
The graph above shows a labor market where the downward-sloping curve is firm demand for labor and the upward-sloping curve is the worker supply curve. The vertical axis shows the hourly wage and the horizontal axis shows the number of full-time workers. Suppose a minimum wage of $9 is instituted. How many unemployed workers will result from the minimum wage? (Note: An unemployed worker is anyone who wants to work but cannot find a job.)
Suppose that education is the only factor that affects productivity and that an additional year of education raises wages by 2%. Suppose in 2011 gender wage gap was 13%, and the average man had 15 years of education while the average women had 14 years of schooling. a) Using the wage gap decomposition technique, calculate how much of the 13% wage differential is due to discrimination? b) Now suppose in 2021 the gender wage gap is 10%, but the average woman’s education level is increased to 17 year and the average man’s education increases to16 years. (Assume that the return to education stays same at 2%), Was there a decrease or an increase in wage discrimination in the decade? Why?
The figure compares the compensation that a shoe salesperson receives if she is on a straight salary of $40 per day or if she receives a commission of $5 for each pair of shoes sold. 100- Commission 90- Which compensation structure is preferred by the salesperson? 80- Suppose the salesperson sells more than 8 pairs of shoes per day and only cares about compensation. 70 60- For the salesperson, the is preferred. 50- Salary 40- 30- 20- 10 10 12 14 Pairs of shoes per day 16 18 20 Compensation received per day
Gerhart & Newman (2020) discuss how compensation (pay) may be a measure of justice, i.e., gender, race, culture, etc. They further state that stockholders are interested in executive pay. Why does it matter, and how is it fixed? How risky are these decisions to employee retention?
Workers in countries such as Sweden and Germany work fewer hours per week, on average, than do workers in the United States. Does this mean that Swedes and Germans are lazier than Americans? Explain how laziness could be interpreted in the context of the work-leisure choice model developed in this chapter. What other information might you want to gather to determine whether Swedes or Germans were indeed less work oriented that Americans?

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