2. If a worker's wage decreases, the substitution effect says their choice of leisure will while the income effect says it will a. Increase, decrease b. Decrease, increase c. Increase, increase d. Decrease, decrease 3. For a profit-maximizing monopsonist (only person hiring), they will hire labor until

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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2. If a worker's wage decreases, the substitution effect says their choice of leisure will
while the income effect says it will
a. Increase, decrease
b. Decrease, increase
c. Increase, increase
d. Decrease, decrease
3. For a profit-maximizing monopsonist (only person hiring), they will hire labor until
the MCE-MRPE. Cortult the following table which I have started to fill out. What is
the optimal number of workers for this firm to hire if their product sells for $15.
Workers Wage MCE
0
3
0
1
N345
2
1234
a.
b. 2
Cool
d. 4
9
21
30
39
3
15
100
**
Product/hour Revenue MPE
N/A
5
4
0
5
9
12
14
15
$0
$75
$135
TE
D
F
Focus
MRPE
N/A
75
60
LILLE
REE -
Transcribed Image Text:2. If a worker's wage decreases, the substitution effect says their choice of leisure will while the income effect says it will a. Increase, decrease b. Decrease, increase c. Increase, increase d. Decrease, decrease 3. For a profit-maximizing monopsonist (only person hiring), they will hire labor until the MCE-MRPE. Cortult the following table which I have started to fill out. What is the optimal number of workers for this firm to hire if their product sells for $15. Workers Wage MCE 0 3 0 1 N345 2 1234 a. b. 2 Cool d. 4 9 21 30 39 3 15 100 ** Product/hour Revenue MPE N/A 5 4 0 5 9 12 14 15 $0 $75 $135 TE D F Focus MRPE N/A 75 60 LILLE REE -
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