a) Employ the skill circle model and calculate skill range, skill range and total labor cost per worker when there are 240 workers and unit training cost is $1260/h and the wage equals $80/h. Training cost is to be borne by the firm. b) Now assume the firm moves to a smaller location and the number of workers is only a quarter of what is was at the first location. Will overall labor cost be a quarter as well? Calculate!

a) Employ the skill circle model and calculate skill range, skill range and total labor cost per worker when there are 240 workers and unit training cost is $1260/h and the wage equals $80/h. Training cost is to be borne by the firm. b) Now assume the firm moves to a smaller location and the number of workers is only a quarter of what is was at the first location. Will overall labor cost be a quarter as well? Calculate!

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

a) Employ the skill circle model and calculate skill range, skill range and total labor cost per
worker when there are 240 workers and unit training cost is $1260/h and the wage equals
$80/h. Training cost is to be borne by the firm.
b) Now assume the firm moves to a smaller location and the number of workers is only a
quarter of what is was at the first location. Will overall labor cost be a quarter as well?
Calculate!

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