2. Offshoring Diagrams using High Skill and Low Skilled labor Consider the US financial industry. When offshoring is occurring, US firms employ both high and low skilled workers in the U.S. and the Philippines. a) Create a task line which arranges some of the tasks you would expect to see in the financial industry ordered from the least skill-intensive on the left-hand side to the most skill-intensive on the right-hand side. (this picture just needs to depict your best guess about which tasks are more or less skill-intense) b) Place a marker somewhere in the middle of your task line, and label it A. If the relative wage for high skill workers in the US is higher than the ratio for the Philippines [ (W^ tilde H /W^ L )us< (W ^ H / (W ^ L)) p 1 will the US do the activities on the right-hand or left-hand side of the division point A? c) Suppose new cyber threats in 2024 increase the cost of offshoring of financial services by U.S. companies. Use diagrams and describe how this affect the relative wages and relative employment of high skilled workers in the U.S and in the Philippines.
2. Offshoring Diagrams using High Skill and Low Skilled labor
Consider the US financial industry. When offshoring is occurring, US firms employ both high and low skilled workers in the U.S. and the Philippines.
a) Create a task line which arranges some of the tasks you would expect to see in the financial industry ordered from the least skill-intensive on the left-hand side to the most skill-intensive on the right-hand side. (this picture just needs to depict your best guess about which tasks are more or less skill-intense)
b) Place a marker somewhere in the middle of your task line, and label it A. If the relative wage for high skill workers in the US is higher than the ratio for the Philippines [ (W^ tilde H /W^ L )us< (W ^ H / (W ^ L)) p 1 will the US do the activities on the right-hand or left-hand side of the division point A?
c) Suppose new cyber threats in 2024 increase the cost of offshoring of financial services by U.S. companies. Use diagrams and describe how this affect the relative wages and relative employment of high skilled workers in the U.S and in the Philippines.
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